Major recycling scam ends in indictment

By ERIC FREEDMAN
Capital News Service

LANSING — A bogus scheme to build an eco-friendly “green energy” waste processing facility in Detroit defrauded lenders and investors — including Chinese investors hoping to qualify for U.S. visas — of $4,475,000, according to a federal grand jury.

Project promoter Ronald Van Den Heuvel promised the victims that his Green Box-Detroit would build and operate a facility to recycle paper, process other waste and produce synthetic fuel, the indictment charged.

He also sought approval from the Michigan Economic Development Corp. (MEDC) to issue $95 million to $125 million in tax-exempt bonds toward the project’s $200 million price tag, legal documents said.

In a related civil suit against Van Den Heuvel and Green Box-Detroit, the Securities and Exchange Commission (SEC) said, “He claimed that he had developed a breakthrough recycling process that could turn post-consumer waste into usable products. He represented that the Green Box process would be both environmentally friendly and profitable, and would allow Green Box-Detroit to repay investors.”

But it was a scam because Van Den Heuvel never acquired the promised facility or equipment and used the money for other purposes, the indictment said.

The Detroit scheme was disclosed in a broad indictment accusing Van Den Heuvel of fraudulently obtaining more than $9 million in investments and loans in Wisconsin and Michigan between 2011 and 2015. He promised to “turn post-consumer waste from sources like fast food restaurants completely into usable consumer products and energy,” the U.S. Attorney’s office in Milwaukee said in announcing the indictment.

“As represented by Van Den Heuvel, the Green Box business plan was to purchase the equipment and facilities necessary to employ a proprietary process that could convert solid waste into consumer products and energy, without any wastewater discharge or landfilling of byproducts,” the indictment said.

Van Den Heuvel, who lives in De Pere, Wisconsin, diverted more than $3.9 million of the $9 million for personal uses, the indictment and SEC suit said. Among them: $44,000 for Green Bay Packers football tickets; $57,000 for court-ordered support for his ex-wife; $89,000 for a new Cadillac Escalade; $16,570 for his children’s private school tuition; and $33,000 for his wife’s dental work.

He also falsified financial statements that “grossly inflated his personal wealth and his companies’ assets,” the indictment said.

His defense lawyer, Robert LeBell of Milwaukee, didn’t respond to requests for comment.

The primary victims of the Detroit project were nine investors from China who poured $4,475,000 into the failed endeavor. They’d hoped to become permanent residents — green card-holders — by investing at least $500,000 each under the U.S. Citizenship and Immigrant Services EB-5 Immigrant Investment Program.

Van Den Heuvel worked through Green Detroit Regional Center, which is owned by a Georgia law firm that is authorized to operate in Wayne, Livingston, St. Claire, Lapeer and Macomb counties, court documents said. The center finds “foreign clients, mainly from China and South Korea, to invest in large alternative energy projects,” according to its website.

The Green Box-Detroit project was portrayed as creating 35 direct and indirect jobs per each Chinese investor.

“Green Detroit Regional Center promoted the EB-5 investments in Green Box Detroit based on Van Den Heuvel’s representations,” the SEC suit said. It said the chief executive officer of the Green Detroit Regional Center, Georgia lawyer Simon Ahn, marketed the project to investors through immigration consultants in China.

Neither Ahn nor Green Detroit Regional Center have been charged or sued by the SEC.

Ahn said, “If the charges are true, it is completely shocking to learn about the extent that Ron Van Den Heuvel hid the truth from me,” the center and investors.

“All of us visited the plants in Wisconsin many times, including the potential site in Detroit, and everything checked out fine. All the financials from a recognized accounting firm indicated that everything was proceeding on track, Ahn said.

The SEC suit said Van Den Heuvel falsely told investors that the MEDC had approved tax exempt bonds for the project. However, the MEDC rejected the request after discovering five tax liens, one construction lien, two state tax warrants, four civil judgments and three civil lawsuits, according to court documents.

“Van Den Heuvel did not satisfy MEDC’s concerns. He did not provide additional information to the MEDC, and did not provide a satisfactory explanation for the issues that it had raised,” the SEC suit said.

MEDC vice president of marketing and communications Emily Guerrant said “Yes, they did approach us. No, we never engaged with them.”

Ahn said it is likely that a receivership will be established to help Chinese investors recoup their money. He said it is “hard to determine at this point” whether they will qualify for green cards.

The grand jury accused Van Den Heuvel of wire fraud and illegal financial transactions. If convicted, he faces a maximum penalty of five years in prison and a $250,000 fine. In addition, the federal government is seeking to recoup the proceeds of the alleged fraud.

Earlier this month, Van Den Heuvel pleaded guilty under a separate 2016 indictment in a bank fraud conspiracy case. Charges against his wife and a bank loan officer in that case are still open.

Farmers uninterested in renting land for bioenergy crops

By JACK NISSEN

Capital News Service

LANSING — When Scott Swinton, an agriculture, food and resource economics professor at Michigan State University, asked landowners if they’d be interested in renting their land for bioenergy crops, the initial response was unexpected.

“The first thing we found was that a number of people that we sent questionnaires to were hoping MSU was secretly trying to find people they could rent land from to grow bioenergy crops,” Swinton said.

“I got scores of phone calls from people telling me they would love to rent their land to MSU if we were interested.”

But that wasn’t what Swinton was looking for. Instead, he was trying to study the willingness of farmers to rent land that isn’t used for crops. Continue reading

Trump’s budget cuts could devastate Great Lakes restoration

By LAINA STEBBINS
Capital News Service

LANSING — Eliminating the $300 million Great Lakes Restoration Initiative could lead to devastating natural and economic effects on coastal Michigan communities, defenders of the program said.

President Donald Trump has proposed killing the initiative, along with the Michigan Sea Grant and nearly a third of the funding for the Environmental Protection Agency.

The possible elimination of the Great Lakes Restoration Initiative has compelled Michigan lawmakers, environmentalists, scientists and business owners to make a case for the program.

“It has benefited Muskegon greatly, hugely. We’ve received millions in dollars in federal funding to clean up White Lake and Muskegon Lake,” said Bob Lukens, Muskegon County community development director. Continue reading

Marches in 10 Michigan cities will celebrate science April 22

By CHAO YAN

Capital News Service

LANSING — Scientists and advocates across 10 Michigan cities will step out of their labs and call attention to the value of science in the March for Science on April 22.

Launched by groups of scientists and researchers in Washington, D.C., earlier this year, the nonpartisan March for Science has expanded into 294 planned satellite marches across the nation and 394 worldwide.

The 10 Michigan cities scheduled to participate on Earth Day are Lansing, Ann Arbor, Detroit, Kalamazoo, Grand Rapids, Midland, Houghton, Marquette, Sault Ste. Marie and Petoskey.

Michigan efforts and the Lansing march were started by science enthusiasts Sara Pack and Sierra Owen of Lansing. Continue reading

Green energy expanding in Michigan communities

By CHAO YAN

Capital News Service

LANSING — Northport, a village in Leelanau County, gets half the energy for its wastewater treatment plant from a community-owned wind turbine.

The village also claims the only 100 percent solar-powered golf course in the United States, according to Stanley “Skip” Pruss, former director of the Department of Energy, Labor and Economic Growth, who moved to Leelanau Township in 2008.

Solar energy is used to power the clubhouse and other operations.

“Our community members are feeling passionately that we are accelerating the transition to clean energy,” Pruss said. “Northport can be an example to other local communities in how to go about doing that. It’s a good way to go.”

Northport has been committed to a 100 percent Clean Energy plan since 2010, joining cities such as Grand Rapids and Traverse City as pioneers in Michigan’s transition from fossil fuels.
Continue reading

Faster decomposing trees can save energy costs

By CHAO YAN

Researcher Steven Karlen studies plants in a greenhouse lab. Image:Great Lakes Bioenergy Research Center

Researcher Steven Karlen studies plants in a greenhouse lab. Image:Great Lakes Bioenergy Research Center

Capital News Service

LANSING — Poplars and other trees can be bred to break down more easily to make biofuel and other products such as paper, according to scientists at the Great Lakes Bioenergy Research Center.

Their new study found that zip-lignin, an enzyme that indicates the high degradability of plants and that they injected into trees, is already in most plants. Plants that naturally have the highest amount can be selectively bred.

The center is a collaboration between the University of Wisconsin-Madison, Michigan State University and other partners. It was established by the U.S. Department of Energy.
Continue reading

State energy bill could increase costs for solar users

By RAY WILBUR

Capital News Service

LANSING — Environmental and renewable energy advocates are concerned that proposed legislation would discourage investment in clean energy.

Sen. Mike Nofs, R-Battle Creek, introduced bills in 2015 to meet the state’s energy requirements as coal plants continue to shut down as utilities use cleaner fuel sources over the next three years.

The bills have passed the Senate and await action by the House, where Nofs said he hopes to see them pass before the end of the year..

But some supporters of alternative energy say that new language added to the bill would create a utilities charge for state residents who use solar power to generate their electricity. The bill does not specify the amount, but gives the Public Service Commission the power to decide how much it would be. Continue reading

Local officials wary of new energy plan

By RAY WILBUR

Capital News Service

LANSING — Some rural officials are concerned that a recent package of energy bills will encourage yet more wind turbines to be built in their communities, leaving residents to bear the physical burden they pose.      

The main thrust of the two-bill package is to increase renewable energy to 15 percent by 2021, attempting to wean the state off harmful coal fire pollution. It is sponsored by Sen. Mike Nofs, R-Battle Creek.

The state successfully reached its previous goal of 10 percent last year.

“The 15 percent mandate would require double the wind turbines, but developers can’t get them built anywhere,” said Kevon Martis, director of the Interstate Informed Citizens Coalition, a Michigan-based group that raises awareness of the negative impacts of wind projects.

“The only people who aren’t being heard are the people living in the projects’ footprints,” he said Continue reading

Converting invasive plants to power plants

By SAM CORDEN

Capital News Service

Scientists [left to right] Drew Monks, Brendan Carson and Eric Dunston use a special harvester to collect cattails in the Shiawassee National Wildlife Refuge. Image: Sam Corden

Scientists [left to right] Drew Monks, Brendan Carson and Eric Dunston use a special harvester to collect cattails in the Shiawassee National Wildlife Refuge. Image: Sam Corden

LANSING — Researchers working in wetlands in Michigan have a new approach to invasive plants.

Instead of removing plants like phragmites and switchgrass, they harvest them. These plants are a threat to biodiversity, they say, but invasive plants can benefit farmers and even power homes.

Scientists are working in the middle of the Shiawassee National Wildlife Refuge which has 10,000 acres of marshes, bogs, forest and farmland. Everywhere you look, there’s a hawk or a herring. Bushes rustle with rodents, and the air is filled with mosquitoes and a thick humidity. To put the size in perspective, Manhattan is roughly 15,000 acres. Continue reading

Lower peak use could mean lower energy bills

By CAITLIN DeLUCA

Capital News Service

LANSING — Energy experts want to lower demand for electricity at peak times to help customers stay green and save money.

Reducing peak demand is called peak shaving, said Sarah Mullkoff, the energy program director for the Michigan Environmental Council.

“An average citizen should be interested in any and all ways to reduce electricity demand and help save money by not investing ratepayer dollars in unnecessary base load power plants,” Mullkoff said.

These base load plants are power plants that aren’t fully used during most of the year, costing taxpayers more money.

If enough energy can be saved, it can eliminate the need for these plants’ unused capacity, she said. Continue reading