Young Erumuse, a director of The London Carbon Credit Company Limited (LCCCL), a company that traded selling carbon credits, based in London, has been disqualified as a director by the High Court for a period of 15 years for selling carbon credits as an investment when they had no genuine secondary resale market, and for failing to keep adequate records.
The disqualification regime exists to protect the public. Young Erumuses disqualification from 2 September 2015 means that he cannot promote, manage, or be a director of a limited company until 1 September 2030.
The company was wound up in the public interest leading to an investigation into the companys affairs by the Official Receiver at Public Interest Unit, a specialist team of the Insolvency Service.
The investigation uncovered that between 29 June 2011 and 27 March 2013, Young Erumuse had caused or failed to prevent LCCCL from inducing members of the public to invest in voluntary emissions reductions (or VERs, also known as carbon credits), for which there is no genuine secondary market. In addition, he failed to maintain, preserve or deliver up adequate company records to explain payments totalling over 2m and receipts of almost 1m.
Commenting on this case Paul Titherington, Official Receiver in the Public Interest Unit, said:
The London Carbon Credit Company Limited was involved in a scheme to deprive investors of their savings by persuading them to invest in a type of carbon credit which has no known resale market. The London Carbon Credit Company Limited purchased carbon credits for an average of 3.50 and charged its customers an average of 110.70 representing an average mark up of 3,163%. It was therefore LCCCL and not its customers, who profited from the VERs. Essentially, investors have lost their money.
The Insolvency Service will not hesitate to use its enforcement powers to investigate and disqualify directors for their role in companies that defraud the public.
I would caution that anyone cold-called and tempted to invest in carbon credits, is being offered nothing but hot air and to simply hang up the call.