Why is bitcoin firm running Kelantan's forest-carbon deal, asks green group

Yasmin Ramlan Melati A. Jalil

THE Kelantan government must come clean about the agreement it signed with green technology company Climate Protectors Sdn Bhd, as the company is allegedly linked to a firm promoting dubious investment schemes. 

Based on the group’s research, Sahabat Alam Malaysia (SAM) president SM Mohamed Idris said Climate Protectors chief executive officer Tang Too Siah is also a board adviser of EcoBit, a cryptocurrency-based investment company. 

Mohamed said EcoBit has been misleading the public by promoting the Kelantan forest carbon-offset project, signed in January, as “the world’s largest REDD+ forest preservation project” with an award emissions avoidance capacity of more than 800 million tonnes.

Cryptocurrency is a digital currency where encryption techniques are used to regulate the generation of units of currency operating independently of a central bank.

REDD-plus is an acronym for Reducing Emissions from Deforestation and Forest Degradation, a United Nations initiative to reduce emissions from the forestry sector. 

“The Kelantan forest carbon-offset deal forms the backbone of EcoBit’s initial coin offering,” Mohamed said in a statement issued on July 3. 

He said EcoBit’s website referred to the REDD-plus mechanism of the United Nations Framework Convention on Climate Change (UNFCCC) as well as the United Nations-REDD Programme, as ready proof for the carbon offset project model.

“Following the signing ceremony, SAM has pointed out the misrepresentation involved in the promotion of the deal as a United Nations-initiated mechanism, when it is not the case.”

The two-year contract signed by Climate Protectors is to audit carbon credits available in the Kelantan’s permanent forest reserves.

Kelantan Menteri Besar Ahmad Yakob was reportedly saying by media earlier this year that Climate Protectors will be rewarded with a 30-year concession to work on the state’s 396,000ha of permanent forest reserve.

On June 26, he said the carbon trading project was official despite Bank Negara Malaysia’s (BNM) warning days earlier.

Both Climate Protector and EcoBit are listed on BNM’s Financial Consumer Alert service on June 23, as “companies and websites which are neither authorised nor approved under the relevant laws and regulations administered by BNM”.

Tang, when contacted yesterday, said he did not know why Climate Protector was red-flagged by BNM, saying a meeting with the central bank is being arranged. 

“We are not sure also we just knew about it yesterday (Monday). We want to have a dialogue with BNM.

“We will look into it. Our legal representative will try to arrange the meeting to understand first what is happening,” he told The Malaysian Insight. 

No carbon offsets under REDD-plus  

Mohamed said until today, the UNFCCC’s REDD-plus mechanism has only been agreed to for results-based payments to developing countries which are eligible to be rewarded for keeping their forests as no carbon sinks and carbon-offsetting deals can be pursued by the private sector.

The group also urged the Natural Resources and Environment Ministry, the focal point of the country to the UNFCCC, to clarify the latest development as cryptocurrency investment is not regulated and the project appears to be more than a straightforward carbon-offset scheme with potential risks. 

“It is incumbent upon the Kelantan government to respond to BNM’s move and to clarify the claims linked to the carbon-offset deal made on EcoBit’s website.

“We reiterate our call to BNM to continue with appropriate investigations and take the necessary actions to protect consumers as well as the government’s effort to obtain international financial assistance for its REDD-plus initiative,” he said. 

Natural Resources and Environment Minister Wan Junaidi Tuanku Jaafar previously said the agreement did not comply with the terms on carbon trading set by the UN.

The minister said all states should get their information about REDD programmes from Putrajaya. – July 5, 2017.

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