New York, NY — Kenneth Newcombe, the former CEO of C-Quest Capital LLC, has been charged with fraud by US federal authorities after being accused of manipulating data from carbon offsetting projects in Africa and Asia. The alleged scheme aimed to fraudulently obtain carbon credits worth millions of dollars by overstating the environmental impact of cooking stove projects.
From 2007 to December 2023, Newcombe served as a board member for Verra, the global certifier of carbon credits, and was previously involved with organizations like the World Bank and Goldman Sachs. He is facing commodities and wire fraud charges and could face up to 20 years in prison if convicted. Newcombe denies the charges, with his spokesperson claiming he is terminally ill from cancer but remains confident the case will be dismissed by a jury.
Prosecutors allege that Newcombe’s actions were part of a broader multi-year scheme to manipulate data, making projects appear more successful in reducing emissions than they were. This allowed C-Quest to attract over $100 million in investments. The company’s cooking stove projects aimed to reduce emissions by replacing traditional fuels like wood and kerosene with cleaner alternatives. However, studies have questioned the true environmental impact, suggesting that the claimed reductions were overstated by an average of 1,000%.
The carbon offset market involves businesses investing in projects that claim to offset emissions to meet their environmental targets. Both Shell and BP have invested in C-Quest, purchasing carbon credits from the company. Newcombe stepped down as CEO in February 2024, shortly before the new C-Quest management reported him to authorities.
Verra, which had certified C-Quest’s projects, has since suspended the affected projects and is working to cancel the overissued credits. In a statement, Verra emphasized the importance of trust in the voluntary carbon market and expressed its commitment to addressing the issue.
Federal authorities have also charged Tridip Goswami, the former head of C-Quest’s carbon and sustainability accounting team, with fraud, though he could not be immediately reached for comment. Former COO Jason Steele has pleaded guilty and is cooperating with the investigation.
US attorney Damian Williams stated, “As alleged, Kenneth Newcombe and Tridip Goswami, among others, engaged in a multi-year scheme to fraudulently obtain carbon credits by using manipulated and misleading data. They then sold those credits to unsuspecting buyers in the multi-billion-dollar global market for carbon credits.”
The case highlights growing concerns over fraud in the burgeoning carbon offset market, which has been crucial in efforts to combat climate change.
