Carbon credit buyers file formal complaints against UAE firm
DUBAI // A group of clients have filed formal complaints about a local company that sells carbon credits as a green investment.
Advanced Global Trading (AGT) claims that its investors can make 30 per cent returns by buying and selling carbon credits. But AGT clients say they have been unable to liquidate their investments for months, and market experts say the assets AGT sold have little to no resale value.
At least five investors have filed complaints with Dubai Public Prosecution and the Dubai Department of Economic Development (Ded).
AGT had been operating with a carbon credits trading licence from the Ded. Its licence expired earlier this month, according to online records. The investors who filed complaints were told by Ded staff that AGT's licence only permitted them to sell carbon credits to institutions, not to individuals, they said.
AGT declined to comment. Ded did not respond to a request for comment.
"Now we are waiting for the prosecutor to say his word," said "Ahmed", an AGT client who spent US$100,000 (Dh367,320) on credits.
A carbon credit represents a reduction in greenhouse gas emissions. Some companies are required by law to "cap and trade" their emissions. AGT is a broker in the unregulated "voluntary market", where companies and people buy credits for other reasons, such as corporate social responsibility.
Many carbon market experts advise against selling credits as investments to members of the public because the voluntary market is illiquid, volatile and difficult to understand.
The International Carbon Reduction and Offset Alliance calls the practice a "distraction and risk to the industry".
However, AGT says it represents "best practices" in a market with many unscrupulous brokers.
When clients buy a credit, it is attached to a specific environmental project that created a reduction in greenhouse gas emissions. But some investors who bought credits from AGT in recent months never received project names or credit serial numbers, they said.