Hacker Turns Profit on Carbon Credits

Wednesday, February 2, 2011 @ 07:02 PM gHale

A savvy hacker that has a solid understanding of how the European Union’s CO2 emissions allowances electronically trade, broke through electronic security systems and transferred millions of virtual certificates that have a very real street value to several different locations.

After accomplishing that feat, it then looks like the perpetrator resold the goods for a handsome profit before authorities knew what happened, according to a published report from Dow Jones.

Power companies and industrial polluters in the European Union need a CO2 emissions certificate for every ton of greenhouse gas they emit in their operations. It’s an added cost to production so to reduce the cost, they have to either cut pollution or get credits for a good price.

Each certificate, or allowance or credit, is worth roughly $19.85 (€14.4).

What began last November as an isolated $31.7 million (€23 million) theft in Romania has turned into a pan-European string of cybercrime, with $25.8 million (€18.7 million) stolen in Prague last week and another $9.7 million (€7 million) in Austria earlier this month. Some of the allowances stolen from Romania were the very same ones stolen last week in Prague.

Throughout the EU, registry operators, local police and EU officials are trying to find out how this criminal perpetrates the crime and how to stop it. The European Commission has temporarily halted trading of the allowances.

Computers and software are having a hard time tracking the allowances.

The problem is right now they must check allowances manually, comparing numbers in one list with those in another with human eyes. Because individual numbers do not undergo an electronic check, traders largely ignore the risk they may be dealing with stolen property.

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