What has happened to Verra’s “investigation” into the Kariba REDD project in Zimbabwe?

19 months after starting its “investigation”, Verra remains silent.

The Kariba REDD project in Zimbabwe was one of the world’s biggest carbon offset projects. In 2023, a series of investigative reports revealed that the project had massively over-estimated the number of carbon credits generated by the project. Little of the money generated from the sale of carbon credits reached the people living in the project area. And the company running the project kept no records of where the money actually went.

On 17 October 2023, Verra announced that it was “initiating an investigation of the Kariba project”. The project could issue no carbon credits until Verra’s investigation was completed.

This announcement came the day after The New Yorker published a superb piece of investigative reporting by journalist Heidi Blake about the Kariba project.

“There is still no result,” as Follow the Money’s Ties Gijzel pointed out last month. According to Verra’s website, “A review may take several weeks or months to complete.”

When Follow the Money asked Verra about why the investigation was taking so long and when it might be completed, Verra did not answer the question. A Verra spokesperson told Follow the Money that, “The results will be made public, in line with Verra’s policy of full transparency.”

Carbon Green Investments

Carbon Green Investments Guernsey Limited is the company behind the Kariba REDD project. The company was founded by Steve Wentzel, a white Zimbabwean businessman. Wentzel made his money in offshore finance. He also invested in gold mines. He got involved in carbon offsetting after he was given a plot of land as payment for a debt.

Carbon Green Investments was incorporated in the tax haven of Guernsey on 9 December 2010.

South Pole helped Carbon Green Investments to set up the REDD project covering a total of 784,987 hectares of land south of Lake Kariba. South Pole’s Project Description Document estimated that the project would generate almost 200 million carbon credits over the 30 year project period.

But that was a massive over-estimation. Follow the Money found that more than 60% of the carbon credits sold were “fictitious”. Bloomberg reported that “the project had overestimated its climate benefits by at least a factor of five”.

The price of carbon credits crashed shortly after the project started in 2011. In 2014, Wentzel demanded that South Pole give him US$1 million to keep the project going. South Pole decided to buy 3 million carbon credits for 50 cents each. South Pole bought the same number the following year.

For a few years, no one wanted to buy the credits. But in 2018, on the back of Greta Thunberg’s “school strike”, South Pole’s business boomed. Companies including Gucci, Nestlé, Volkswagen, Porsche, and Delta Air Lines bought Kariba carbon credits.

South Pole could now sell Kariba carbon credits for more than US$15.

In 2020, TotalEnergies put out a press release about “carbon neutral liquefied natural gas”. It was supposedly “carbon neutral” thanks to carbon credits from the Kariba REDD project.

Renat Heuberger, the co-founder of South Pole, whose company had sold the carbon credits to TotalEnergies, pointed out to Bloomberg, that “carbon neutral” fossil gas was “such obvious nonsense”. He added, “You’re burning fossil fuels and creating CO₂ emissions.”

Of course South Pole raised no objections about TotalEnergies using the term “carbon neutral”.

South Pole pulled out of the Kariba REDD project in October 2023. Heuberger resigned as CEO of South Pole in November 2023.

“There’s no paper trail”

By 2022, South Pole had made more than €100 million from sales of Kariba carbon credits. After South Pole had taken its cut, Carbon Green Investment was supposed to keep 30% of the money. The rest should have gone to pay district councils and fund project operations.

But Wentzel did not keep any records of where the money went. “There’s no paper trail,” he told The New Yorker.

Follow the Money notes that “The promised investments in water wells, schools and healthcare clinics could not be verified.”

Wentzel even acknowledged that the way he transferred money from Guernsey to Zimbabwe was “illegal”.

“I will probably go to jail,” he told The New Yorker.

Today, Carbon Green Investment’s website makes no mention of the Kariba REDD project. Instead, the company claims to be “a beacon of innovative environmental stewardship and community engagement”.

On 18 April 2024, Carbon Green Investments moved from one tax haven to another. The company applied to the Registrar of Companies in Guernsey to be removed from the Register in Guernsey, in order that the company could be registered in the tax haven of Mauritius.

Trophy hunting

A 2017 documentary film called “Trophy” features one of the founders of the Kariba REDD project, Chris Moore. The film includes footage of anti-poaching operations inside the REDD project area. It also includes footage of Moore talking about foreign hunters coming to the area to hunt. He says that this “really subsidises the money that I have to run my anti-poaching”.

On 16 October 2023 (the same day that The New Yorker published Blake’s reporting on Kariba), Follow the Money reported that trophy hunting was taking place inside the Kariba REDD project.

This followed an investigation by Follow the Money, Die Zeit, and Swiss broadcaster SRF. Ties Gijzel of Follow the Money reports that when they visited the project area, the journalists “found hardly any tangible results of the claimed conservation work, but instead, muddled and incomplete financial documentation”.

They also found that in addition to selling carbon credits, Wentzel was profiting from trophy hunting inside the REDD project area.

Peter Hingeston of a company called HKK Safaris told Follow the Money that “We paid Wentzel for the hunting rights. During 2018 and 2019, we paid him hundreds of thousands of dollars.”

Hingeston backed this up with a contract and payment receipts. Wentzel transferred hunting rights from 2018 to 2021 for US$600,000. The money was transferred to Wentzel’s bank account in the tax haven of Mauritius.

Verra responded to the news by stating that,

It is new information to Verra that we need to analyze. It is unlikely that projects engaging in trophy hunting activities would meet the rules and requirements of Verra’s programs.

Still waiting . . .

It is now more than 19 months since Verra started its investigation into the Kariba REDD project. In October 2023, Verra wrote that,

If it is determined that unethical or illegal behaviour took place, Verra could suspend the project proponent’s Registry account. If it is determined that a reversal took place, Verra could tap into the buffer pool to account for the reversal. If it is determined that an excess issuance of credits has occurred, Verra could require compensation from the project proponent. Verra is assessing these and all other options.

Verra has a buffer of more than 75 million carbon credits, set aside in case projects fail. In 2023, Verra told Bloomberg that if Kariba shuts down, it will replace the credits issued by taking them from its buffer pool. This could use up between 38% and 51% of the buffer pool.

Verra’s buffer pool might be big enough to deal with the failure of the Kariba REDD project. But if all the other dodgy projects in Verra’s registry were to be meaningfully investigated, that would very quickly exhaust the buffer pool.

In May 2024, Carbon Green Investments announced that it was withdrawing the Kariba REDD project from Verra’s registry.

Following the withdrawal of the project, Verra’s Joel Finkelstein stated that,

We have engaged, in the most timely way possible, in a good-faith effort with a publicly reported and self-professed bad actor.

Finkelstein also said that Verra was taking “the necessary time” to review the project and would deal “aggressively with any bad behavior”.

But more than one year after he said this, we’re still waiting for any action whatsoever from Verra.