The chief executive officer and another top executive of an electronic waste-recycling company were convicted Friday in a Denver court of smuggling, environmental crimes, mail and wire fraud, and obstruction of justice in conjunction with the illegal export of hazardous waste to China and elsewhere, according to the U.S. Attorney's Office for the District of Colorado.
Executive Recycling, formerly of Englewood, Colo., collected used cell phones, computers and other electronics components from individuals and businesses, and advertised that it would properly recycle or recondition the devices in the United States.
The Basel Action Network, a watchdog group focused on trade of toxic materials, observed and photographed 20 sea-going containers full of computer monitors and TVs leaving Executive Recycling's loading docks and tracked them to Hong Kong. After CBS' 60 Minutes
in 2008 aired an investigative piece based on the Basel Action Network's tip, the Justice Department, with the help of the Environmental Protection Agency and the Department of Homeland Security, indicted the company.
CEO Brandon Richter and Tor Olson, executive vice president of operations, are scheduled to be sentenced in April. Several of the counts include penalties of up to 20 years in jail and fines up to $250,000.
"This conviction is very welcome, but sadly as we speak, there are many hundreds of other fake recyclers out there that are loading up Asian-bound containers full of our old toxic TVs and computers," said Basel Action Executive Director Jim Puckett in a statement. "Every day about 100 containers of toxic e-waste arrive in the Port of Hong Kong alone. We hope this conviction sends a very strong message to business and the public that they should only use the most responsible recyclers."
Basel Action and the electronics industry have created an electronics recycling certification program, called e-Stewards, that annually audits companies to make sure they don't export hazardous waste from electronics to developing countries. As the "60 Minutes"
piece showed, many recycling shops in China don't follow recommended safety and environmental precautions for removal and disposal of toxic metals from electronic components, leading to severe soil and water contamination. Lead levels among children in Guiyu township in China are extremely high, Basel Action says.
Lead is prevalent in cathode ray tubes used in old computer monitors and TVs.
The government used shipping invoices and the 60 Minutes
piece as evidence against the Richter and Olson. It claimed the defendants made $1.8 million selling used electronics components to foreign buyers through brokers, and then shipped the containers to ports by rail for export.
Executive Recycling appeared as the exporter of record in over 300 exports from the United States between 2005 and 2008. About 160 of the containers it exported contained more than 100,000 cathode ray tubes, according to the U.S. Attorney's office.
Executive Recycling as a corporation faces more than $1 million in fines for wire fraud, illegal export, and failure to file notification of intent to export hazardous waste, the District Attorney's office said.
"This criminal conviction demonstrates that there are no shortcuts to following U.S. export laws," Kumar Kibble, chief operating officer of Homeland Security Investigations, said. "For years, this company also deceived the public by falsely advertising an environmentally friendly U.S.-recycling business plan. Instead, it regularly exported obsolete and discarded electronic equipment with toxic materials to third-world countries, and took actions to illegally hide these practices from government officials."
Basel Action is pushing Congress to pass legislation making e-waste exports illegal, as they are in other parts of the world. It said the lack of clear laws make it difficult for the federal government to prosecute such cases, which currently hinge on applying fraud, smuggling and other charges to stop the activity.
Executive Recycling has changed its name to Techcycle, according to Basel Action. - Eric Kulisch