Friday, March 24, 2006

Guilty Pleas in Bottle Deposit Scheme

While the amount you get for recycling bottles and cans is not much, if you have enough of them you're talking about real money.  Kramer and Newman certainly figured that out on Seinfeld when they collected cans in New York and planned to drive them to Michigan, which has a ten cent deposit (Episode 131, Season 7 -- synopsis here).  A number of defendants in California have entered guilty pleas to fraud charges for obtaining deposit refunds on bottles and cans collected in other states or Mexico, and claims for non-existent recyclables.  A press release (here) issued by the U.S. Attorney's Office for the Central District of California describes the guilty pleas of Errol Segal, Memveluz Lampert, and two corporations under Segal's control, Active Recycling and Worldwide Recycling:

California consumers pay into the state's beverage container recycling system every time they purchase certain beverages – such as soda – in glass, plastic and aluminum containers. This money is refunded to the consumer when containers are redeemed at privately-owned recycling centers, which then reclaim California Redemption Value payments from the state Department of Conservation. Only cans and bottles sold in California are eligible for the CRV refund. Segal, Lampert and the other defendants defrauded the program by seeking and obtaining payments for recyclable goods that came from outside California or simply did not exist.

Appearing before United States District Judge A. Howard Matz last night, Segal pleaded guilty to mail fraud and to conspiring with several individuals to process non-CRV cans and bottles that were transported into California from other states and from Mexico, and then submitting falsified paperwork seeking reimbursement from California for processing those ineligible cans and bottles. The scheme led California to pay Segal and his corporations more than $2 million between September 1998 and February 2000.

Appearing yesterday morning before Judge Matz, Lampert pleaded guilty to conspiracy in a second scheme to defraud the State of California. Lampert admitted that, at the direction of Segal, she oversaw Active Recycling employees who processed paperwork for non-existent bottles and cans that were never recycled. As part of this scheme, which cost California more than $400,000 in less than a year, Lampert directed Active Recycling employees to falsify paperwork that allowed it to receive CRV payments for non-existent bottles and cans.

Watch out for those cans and bottles. (ph)

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I live in Michigan and I have a neighbor who get's truck loads of can from Indiana and reurns them for money. I was wondering who suffers from the returns?

Posted by: Cathy G | Jun 8, 2007 8:04:15 AM

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