Trading in air to make no difference to the temperature Jo Nova on the carbon trading system Kevin Rudd is linking us to one year earlier: Unfortunately, fraud has been a big, ongoing problem with emissions trading. This market needs auditors, and the auditors need auditing (the top two auditors in the EU emissions trading scheme were suspended in 2009 for irregularities). The EU has already lost â¬5 billion to carbon-trading value-added tax fraud. The mafia is laundering money in Italy through renewables schemes, and after one tax loophole was closed, market volume in Belgium dropped by up to 90 per cent. The carbon market also depends on the honesty of people claiming: "We wouldn't have built that dam without that carbon credit." How would we know? The Xiaoxi dam in China was already under construction two years before the owners applied for credits "to build it..." Most of the key factors in a carbon market are misnamed. The market is not free. An essential plant fertiliser is called pollution. The aim of the market is not to make clean energy but to change global temperatures by an amount that rounded to the nearest degree, equals zero. The US has no market but has reduced emissions (largely thanks to shale gas), while any reductions in EU emissions were largely due to falling gross domestic product. Yet the government wants to join the EU scheme.