OAKLAND -- A bottle and can recycling company with locations in Oakland and San Francisco was ordered to pay $2 million in restitution to the state of California and kicked out of a lucrative bottle and can reimbursement program following a fraud investigation.
The restitution order against Recycle Today in Oakland and Paper Rush in San Francisco is a rare crackdown by the state and is meant to set an example for others tempted to defraud the California Redemption Value program, said CalRecycle spokeswoman Heather Jones.
Jones said an investigation in 2008 and 2009 revealed owners June Tran Vahn and Hugo Centeno got reimbursements from the state for redeeming previously recycled bottles and cans and for reimbursements of cans and bottles that came from out of state.
The state pays can and bottle recyclers like Vahn and Centeno 5 to 10 cents per bottle and can sold in California. The money comes from consumers who pay the 5 to 10 cents when they buy a beverage and serves as an incentive to recycle cans and bottles instead of throwing them in the trash.
The investigation suggested the two got help from one or more processors in the program who gave them the already processed materials to redeem a second time, Jones said.
"This was a pretty good case and we were able to shut them down," Jones said. "Usually we put them on probation."
Vahn, who worked in recycling for 26 years, said she's already gone out of business and is offering the state $350,000 over five years instead of the $2 million. She said a judge will make a decision on her offer Nov. 25.
"What they say is not the truth," Vahn said. "We worked so hard for the program. We closed the business, so they can't get anything now. It's too bad they treat us like that."
The state feels differently.
"I don't think we could have shut them down if we didn't prove there was some intent to defraud," Jones said.
Contact Doug Oakley at 925-234-1699 or follow him on Twitter at www.twitter.com/douglasoakley