Crime goes green as California loses millions to recycling scam

October 11, 2012 by AljonG

Recycling is good for the earth and good for industry, as it means supplies could be used again and again. However, those states which encourage recycling through container deposit redemptions, such as a dime for every beer bottle one turns in, are getting disciplined for their good deeds. Numerous states, such as California and Michigan, are losing millions annually to recycling fraud. Source for this article: Shouldn't one look at our own webpage?

Getting cash with recycling

There are a lot of things that could be learned from “Seinfield,” the 1990s sitcom that was really popular. In one episode, the characters took a truck of beer bottles to Michigan so they could get 10 cents per bottle rather than the offered New York rate of 5 cents, according to the LA Times.

This kind of fraud is costing California millions of dollars every year, according to the LA Times article. Just like in the show, people will take their cans from out of state to California so they can get five cents for every beverage container such as glass and plastic bottles and 10 cents for larger containers.

Get A quick payday

The law only provides compensation for bottles, cans and so on sold in California, but numerous individuals have been caught driving truckloads of cans and bottles from Arizona and Nevada. That method of recycling fraud, along with deposit center claims for reimbursement for the same container many times over and other fraudulent bookkeeping, is costing the state at least $40 million per year, if not more. Some estimates put it upward of $200 million.

The whole point of the incentive is that each bottle gets a 5 or 10 cent premium in the purchase price. Then, that additional cash can be redeemed for cash later assuming the person goes to the recycling center. The idea is to keep people recycling by taking their money and giving it back upon return. The out of state cans make it really challenging.

About $1.1 billion got paid in container deposits last year in California, but the state only paid $100 million back out to get the storage containers back.

Becoming robbers by going green

Reusing containers is not only good for the environment, it is great for manufacturers. It's an old practice, too; early instances of offering cash for empty containers was recorded around 1800, according to a very good history of British soft drinks on Britishsoftdrinks.com, site for a British trade association for beverage makers. Aside from an Irish spring water company called A&R Thwaites and Co., another business doing likewise at the time was a soda water outfit called Schweppes.

In total, 11 states have a container deposit redemption program. Some of those states have also experienced recycling fraud as a result. The state of Maine, according to the Bangor Daily News, was estimated in 2011 to be losing $8 million per year to container deposit fraud and the 10 percent of all redeemed containers were from out of state. Michigan certainly is losing cash as well, an estimated $13 million per year, according to Mlive.com, a news aggregator site for numerous Michigan newspapers.

Sources

Los Angeles Times

Bangor Daily News

Mlive.com

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