US regulator homes in on malpractice in voluntary carbon markets

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🗞️ Driving the news: The U.S. Commodity Futures Trading Commission (CFTC) is investigating greenwashing in the voluntary carbon markets as part of its effort to combat fraud and misconduct
• This initiative is conducted by the CFTC’s Environmental Fraud Task Force, which was established in June 2023
• The agency aims to introduce federal guidelines for voluntary carbon credits derivatives by the end of 2024

🔭 The context: The CFTC is focusing on false claims about the environmental benefits of carbon credits and the green credentials of financial products
• The agency's actions are in response to concerns about the lack of federal oversight in the voluntary carbon markets
• This move follows the Securities and Exchange Commission's similar efforts to address greenwashing in ESG investment strategies

🌍 Why it matters for the planet: By establishing standards and curbing manipulation, the CFTC aims to ensure the integrity of the carbon markets, promoting genuine environmental benefits and preventing deceptive practices that could undermine climate goals

⏭️ What's next: The CFTC is gathering tips from whistleblowers and is actively investigating several cases of potential fraud
• The agency plans to finalize its guidelines for voluntary carbon credits derivatives by the end of 2024, drawing from industry standards like the Integrity Council for Voluntary Carbon's Core Carbon Principles

💬 One quote: "The idea is to weed out the bad actors that could impact the derivatives market, we would do that with any commodity," said CFTC commissioner Christy Goldsmith Romero

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