Clean cookstove developer C-Quest Capital (CQC) has canceled a total of 5 million carbon credits in the Verra registry, following the FBI and U.S. Attorney for the Southern District of New York indicting former CEO Ken Newcombe on data manipulation charges.
These cancellations are part of the company’s reconciliation efforts after a comprehensive review of its projects.
In total, 19 projects have been affected by the cancellations, all located in Africa and Southeast Asia.
Additionally, six projects have been suspended, though they have not issued any cancellations yet, suggesting that the overall volume of cancellations may increase.
The largest cancellations involve two projects in Malawi (VCS2342 and VCS2372), both cited by U.S. authorities in the case against Newcombe, former Chief Operating Officer Jason Steele, and Tridip Goswami, the former head of the company’s Carbon and Sustainability Accounting Team.
VCS2372 has canceled 2 million credits, equivalent to more than a year’s worth of emission reductions, while VCS2342 has canceled 1.1 million credits.
The other affected projects are located in Angola, Cambodia, Kenya, Laos, Mozambique, Tanzania, Thailand, Vietnam, Zambia, and Zimbabwe; however, in some cases, the canceled credit volumes are minimal.
On October 2, the FBI and U.S. Attorney for the Southern District of New York announced serious charges against Ken Newcombe, CQC’s former CEO, and two colleagues. Weeks prior, Newcombe had already been publicly accused of “wrongdoing” by his former employer.
Simultaneously, two major U.S. financial regulators, the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC), also filed civil charges against Newcombe.
He has been accused of orchestrating a complex fraud involving the wrongful issuance of 6 million out of the 17 million carbon credits issued.
A spokesperson for Newcombe stated that the charges came despite Newcombe being terminally ill with cancer.
The spokesperson further added that “medical experts” believe the former CEO has “virtually zero chance of surviving to exercise his constitutional rights to defend himself and confront his accusers.”
