Blog # 4- Organized Crime Relating to the Carbon Market

Chelsea Smothers

Blog # 4

2/12/2011

9:04 PM

European Union pollution permits were stolen, sparking a police hunt across the continent. Organized criminals are being blamed for this act. When CO2 permits are stolen, the thieves try to sell them in a market before the owners realize they are even missing, according to Czech trader Nikos Tornikidis. These criminals may have exploited "negligent" security standards in some European Union nations that participate in the world's largest system for trading rights to discharge greenhouse gases, said Jos Delbeke, the director general for climate at the European Commission. Computer attacks that happened this month could be related to last year's outbreaks of "carousel fraud" and "phishing attacks," said the director of Europol. The European Union regulator suspended registries on January 19th in 30 countries that track carbon permits. This act caused a 12-day halt in spot trading. The commission stated that as many as 2 million permits, valued at 30 million euros($42 million), may be missing. Some permits, however, may be recovered. In Greece, CO2 hackers have been traced and arrests will be announced within the next few days. On January 21, the Austrian registry announced that it tracked down 488,141 missing carbon credits in Sweden and Liechtenstein shortly after a January 10th hacking attack, and authorities blocked them from use. All registries in Europe have been blocked by the European Union after Blackstone Global Ventures, a trader that is based in the Czech city of Brno, informed national administrators on January 19 that 475,000 allowances were missing from its account. Last week CEZ AS said it lost 700,000 allowances in unauthorized transfers in the raids on registry. "The environmental effectiveness is not threatened," Delbeke stated. "There's a short-term pain, but I'm convinced it'll become a long-term gain," said Delbeke. "Once this is behind us, we'll have a much stronger system, which a much stronger infrastructure," he said.

The way I see it, none of these thieves could get away with these actions of the system was stronger. If it keeps happening, either not enough attention is being put on it or the same mistakes are being made in order to not be able to resolve the issue. For Delbeke to say that the problem is just a short-term pain, I disagree. It seems to me it is becoming a long-term pain since the issue is not clearing up. I do hope though, the the problem does become just a part of the past soon, and just like Delbecke said, the system will be stronger.

http://www.businessweek.com/news/2011-01-31/organized-crime-blamed-for-roiling-110-billion-carbon-market.html