California's generous recycling redemption program has led to rampant fraud. Crafty entrepreneurs are driving semi-trailers full of cans from Nevada or Arizona, which don't have deposit laws, across the border and transforming their cargo into truckfuls of nickels. In addition, recyclers inside the state are claiming redemptions for the same containers several times over, or for containers that never existed.
The illicit trade is draining the state's $1.1-billion recycling fund. Government officials recently estimated the fraud at $40 million a year, and an industry expert said it could exceed $200 million. It's one reason the strapped fund paid out $100 million more in expenses last year than it took in from deposits and other sources.
"The law says California has to make it easy to recycle … so anyone with a devious mind, it's so easy, they can just go right in," said Los Angeles County sheriff's Deputy Dave Chapman, who has investigated fraud rings in recent months.
Under the state's 25-year-old recycling law, California charges consumers a deposit on most beverage containers sold within its borders. Anyone who brings empty containers back to one of about 2,300 privately run recycling centers can collect 5 cents for most cans and bottles and 10 cents for larger containers.
Only products sold in California are eligible. But a can is a can — and many recycling centers in California aren't that interested in where they come from.
Tuesday, October 9, 2012
Live discussion: California recycling fraud a costly problem
This is the reason only a handful of states have these programs. And why have these anyway? People can sell their scrap cans to private companies and get money that way.