Indonesian Palm Oil Fraud Probe Connects Suspect Suppliers to Eni and Neste

Eleven arrests put European biofuel supplies under scrutiny

Indonesian authorities have arrested 11 people, including customs officials and company executives, over an alleged scheme to export palm oil under the label of a cheaper waste product. The attorney general's office says companies conspired with officials between 2022 and 2024 to avoid higher export taxes, costing the state millions of dollars.

Documents and trade records connect suppliers implicated in the investigation to Italian energy company Eni and Finnish sustainable aviation fuel producer Neste. Both received shipments from businesses linked to the detained executives. There is no suggestion that either buyer, or other European customers, knew about or participated in the alleged fraud.

Eni and Neste say they removed palm oil from their supply chains years ago because of environmental concerns. Their purchases of material labelled as palm oil mill effluent, known as POME, now put the checks used to verify those supplies under scrutiny. Shipments received in 2023 and 2024 form part of a broader trading history that extends into 2025.

The stakes reach beyond Indonesia's tax revenue. European policies encourage fuels made from waste while restricting palm oil because of its connection to forest destruction. A shipment's classification therefore affects both the taxes paid when it leaves Indonesia and its acceptance as a raw material for fuel in Europe.

As of March 17, 2026, three identified executives remain in custody, according to the attorney general's office. Eni and Neste have announced action to remove the implicated businesses from their supply chains. One connected supplier, Green Product International, still holds a valid sustainability certificate, despite the detention of a shareholder.

Why the POME label matters

Palm oil is the main vegetable oil extracted from oil palm fruit. It is used in food, cosmetics and, increasingly, as a raw material for biofuels. POME is different: it is liquid waste generated during palm oil milling and refining, traditionally requiring treatment and disposal.

Indonesia applies substantially higher export duties to palm oil than to POME, which is classified as a waste material of lower value. Prosecutors allege that exporters bribed customs officials to pass palm oil off as POME. That would allow them to pay lower taxes while selling a valuable product to international fuel producers.

Indonesia is seeking greater returns from its natural resources, making the alleged loss of millions of dollars a matter of public revenue as well as customs enforcement. The investigation concerns both the companies preparing shipments and the officials responsible for checking their classification.

Europe gives the same distinction a second financial importance. The European Union plans to ban palm oil in biofuels from 2030 because of its documented connections to deforestation and habitat destruction. POME certified as waste faces fewer restrictions under EU renewable energy rules, making it attractive to producers trying to meet targets for reducing emissions.

For a buyer, the essential question is whether the material delivered actually matches the waste description on its paperwork. If valuable palm oil can enter a supply chain under that description, the tax rules and environmental safeguards depend on verification that has failed at the point of classification.

The executives and their trading connections

Authorities detained the 11 suspects in February 2026, including directors of three companies and several customs officials. Trade data, shareholder agreements and customs documents obtained through freedom of information requests helped identify three of the arrested executives.

Tony, who uses a single name, is a director of Tanimas Edible Oil and a shareholder in Green Product International. Official documents identify him by the initials TNY. Green Product International was Eni's leading Indonesian supplier of palm oil products between 2023 and 2025, sending 21 consignments. The most recent arrived in October.

Green Product International also sent at least 27 cargoes to Neste during the same period. Those figures put the company in the supply chains of both European producers over several years, rather than through a single isolated shipment.

Van Ricardo, a director of Surya Inti Primakarya, and Erwin, a director of Bumi Mulia Makmur, were also arrested. Both signed off on shipments to Eni between 2022 and 2024. The attorney general's office says Tony, Van Ricardo and Erwin remain in custody.

Green Product International did not respond to requests for comment. Calls to Surya Inti Primakarya and Bumi Mulia Makmur went unanswered. The allegations remain under investigation.

How Eni and Neste responded

Eni says it has zero tolerance for breaches of regulations and had no direct contracts with the accused companies. It received the shipments through Enviq, an accredited supplier. According to Eni, Enviq immediately suspended all operations with the companies involved after the investigation became public. Enviq did not respond to requests for comment.

Neste says it instructed its supplier to exclude the implicated businesses from its supply chain the day after Indonesian authorities announced the arrests. The company says it takes fraud risks seriously and has developed robust methods for testing incoming material.

Neste also says periodic sampling of deliveries from Green Product International between 2023 and 2025 produced results consistent with waste and residues derived from palm oil, rather than the typical profile of crude palm oil. Its response places laboratory testing alongside the paperwork and certification used to check deliveries.

Green Product International's customers extended beyond Eni and Neste. Trade records show supplies to Swiss trader Kolmar, Spanish oil company Repsol and American agricultural company Cargill. None provided statements for publication about the allegations.

Eni's account shows how intermediaries can sit between a fuel producer and an exporter. The Indonesian businesses supplied material entering Eni's operations, while the commercial relationship described by Eni was with Enviq. Neste likewise directed its supplier to remove the businesses, making the response a change across its supply chain.

The dates behind the investigation

The alleged tax scheme, the trading records and the European policy response cover different periods. The investigation focuses on conduct between 2022 and 2024, while records of deliveries from Green Product International extend through 2025.

• 2014 and 2018: Government records show fines against palm oil suppliers for illegal forest burning in the Tripa peatland.
• 2019: The EU decided to phase out palm oil biofuels because of their connection to deforestation.
• 2022 to 2024: Indonesian authorities allege that companies bribed customs officials to mislabel palm oil as POME. Van Ricardo and Erwin signed off on shipments to Eni during this period.
• 2023 to 2025: Green Product International sent 21 consignments to Eni and at least 27 cargoes to Neste. Neste says its periodic sampling covered deliveries during these years.
• October: The latest identified Green Product International consignment to Eni arrived. Neste also extended an agreement with United Airlines in October.
• February 2026: Indonesian authorities detained 11 people in the fraud investigation.
• 2027: Germany is due to implement a moratorium similar to Ireland's removal of financial incentives for POME in biofuels.
• 2030: The planned EU ban on palm oil in biofuels takes effect.
• 2050: The EU requires European airports to ensure that at least 70 percent of aviation fuel is sustainable.

Ireland has already ended its financial incentives for POME. Germany's planned action comes ahead of the EU's 2030 palm oil deadline, showing that governments are also addressing the treatment of waste products within the current rules.

Certification faces a test of credibility

Eni says its shipments were handled by a company certified under International Sustainability and Carbon Certification, or ISCC. The EU recognizes the scheme as a verifier of palm oil imports for biofuels. Its purpose is to track products from origin to destination and check that deliveries match their documentation and promised sustainability standards.

An ISCC spokesperson said Surya Inti Primakarya is currently excluded from recertification. Bumi Mulia Makmur was previously excluded for unspecified violations. Green Product International, however, still has a valid certificate in the organization's online registry.

ISCC did not respond when asked whether Green Product International's accreditation would be reviewed following the criminal investigation and the detention of its shareholder. The stated reasons for Bumi Mulia Makmur's earlier exclusion also remain unspecified.

James Cogan, head of public policy at Irish biofuel producer ClonBio, has called for public access to the records behind POME supplies. ClonBio sources exclusively from within the EU to avoid these risks. Cogan challenged processors to make their trading information available for independent checks:

I would challenge any POME or POME-based biofuels processor to publish their volumes, sources and paperwork, to allow public and independent scrutiny.

Some independent analyses suggest that the amount of POME used in the EU and Britain exceeds the estimated quantity available worldwide. Industry trade groups dispute those calculations as inaccurate. The disagreement concerns the size of the legitimate waste supply and how much fuel production it can support.

Cogan's call addresses the same practical problem from another direction: access to volumes, origins and supporting documents would allow people outside the certification process to examine whether the quantities being traded fit the stated supply.

Sumatra's forests give the case a wider cost

Green Product International operates from the northern end of Sumatra. The island contains some of the world's most threatened forests and the only remaining habitat where Sumatran orangutans, rhinos, Asian elephants and tigers still coexist in the wild.

The Tripa peatland, once celebrated as the orangutan capital of the world, has shrunk by 86 percent since the turn of the millennium as forests have been cleared for palm plantations. That leaves about 14 percent of its former extent, illustrating the scale of the loss.

Ian Singleton, conservation manager at Orangutan Haven in North Sumatra, described what forest clearance means for the animals living there:

It's devastating. Once you chop the forest down, the orangutans have nowhere to live.

According to Singleton, the local orangutan population has fallen from approximately 60,000 in the 1980s to roughly 30 survivors today. Habitat destruction, driven largely by palm oil expansion, has pushed that population toward local extinction.

Investigative documents also connect the detained executives to another part of the palm oil trade. Tony and another Green Product International director serve as directors of Inno-Wangsa Oils & Fats. That regional company bought palm oil from suppliers previously fined for burning forests in Tripa.

Government records show that those suppliers received fines in 2014 and 2018 for illegal forest burning but continued operating. Satellite imagery reviewed during the investigation indicates that deforestation at one supplier's site ranked among the highest rates recorded anywhere in Indonesia during the past year.

Singleton said the convictions had brought pride at the time, but described a much less encouraging outcome in the forest:

We were really proud of getting those convictions. But on the ground it didn't really make a lot of difference.

The forest history gives a concrete reason for Europe's restrictions on palm oil. The environmental concern is about what happens where the raw material is produced, including the destruction of habitat, rather than simply what a shipment is called when it reaches a fuel plant.

Ireland and Germany tighten support for POME

Ireland has ended all financial incentives for POME used in biofuels, deciding that verification problems make the material too risky to support with public money. Germany will implement a similar moratorium in 2027. The measures effectively close two European markets to incentivized POME imports regardless of certification status.

Environmental campaigners argue that current certification cannot reliably separate genuine waste from palm oil carrying a false label. Their concern is that policies intended to reward cleaner fuels could instead reward products tied to forest destruction.

Cian Delaney, a biofuels campaigner at the Brussels environmental organization Transport and Environment, said the EU made the right decision in 2019 to phase out palm oil biofuels because of documented deforestation links. He warned that gaps in the rules still allow dishonest operators to exploit the system:

Verification and certification of these imports is clearly failing. European Union climate policy that is supposed to promote green fuels is being cheated.

The national measures address the financial support given to POME, while the EU's planned 2030 ban concerns palm oil in biofuels. Both policies depend on knowing which material is actually being traded. A waste classification carries economic advantages only if the product meets that description.

Aviation fuel demand increases the stakes

European airports must ensure that at least 70 percent of aviation fuel is sustainable by 2050 under the mandate set by Brussels. That target is creating substantial demand for biofuels just as airlines face pressure from regulators and consumers to reduce carbon emissions.

Eni recently signed a deal lasting five years to supply Ryanair with up to 100,000 tonnes of sustainable aviation fuel. Neste extended an agreement covering several years with United Airlines in October. It also supplies major airports, including Schiphol in Amsterdam and Los Angeles International.

Eni and Neste therefore operate at the meeting point of growing airline demand and the need to verify raw materials. Their announced supplier exclusions address the businesses identified in the Indonesian investigation, while Neste's sampling results describe the checks it says it performed on past deliveries.

Delaney warned that palm oil linked to deforestation entering fuel supplies under a waste label could completely undermine the climate benefits claimed for those fuels. The central issue is whether production replaces a discarded material with a useful fuel or encourages the palm oil activity that European policy is trying to restrict.

Indonesia's investigation brings that issue back to specific people, companies and shipments: 11 arrests, an alleged tax scheme operating from 2022 to 2024, and trading relationships extending into 2025. The responses by buyers and certifiers now sit alongside a criminal investigation into how those exports were classified.

The Bottom Line

• Indonesia arrested 11 people in February 2026 over alleged mislabelling of palm oil as POME to avoid higher export taxes between 2022 and 2024.
• Tony, Van Ricardo and Erwin remain in custody, according to the attorney general's office.
• Green Product International sent 21 consignments to Eni and at least 27 cargoes to Neste between 2023 and 2025.
• There is no suggestion that European buyers knew about or participated in the alleged fraud. Eni and Neste have announced steps to exclude implicated suppliers.
• Neste says periodic sampling found material consistent with palm waste and residues rather than the typical profile of crude palm oil.
• Green Product International retains a valid ISCC certificate; Surya Inti Primakarya is excluded from recertification, and Bumi Mulia Makmur was previously excluded.
• Tripa peatland has lost 86 percent of its extent since the turn of the millennium, while connected palm oil suppliers continued operating after forest burning fines.
• Ireland has ended POME incentives, Germany plans a similar moratorium in 2027, and the EU plans to ban palm oil in biofuels from 2030.
• The EU's aviation fuel requirement reaches at least 70 percent sustainable fuel by 2050, increasing demand for supplies whose origins can be verified.