Fuel thefts mak­ing crim­i­nals mil­lions

Gangs use stolen credit cards to sell black-mar­ket gas.

Austin American-Statesman - - MORE OF TODAY’S TOP NEWS - By Bren­dan Far­ring­ton

A black mar­ket for diesel fuel and gaso­line has rapidly spread around the na­tion, with or­ga­nized crime gangs us­ing fraud­u­lent credit cards to siphon mil­lions of dol­lars in fuel from gas sta­tions into large tanks hid­den in­side pickup trucks and vans.

Steal­ing fuel can be less risky than sell­ing drugs or other il­le­gal en­deav­ors, and crim­i­nals can make $1,000 or more a day re­selling the stolen fuel at con­struc­tion sites and un­scrupu­lous gas sta­tions, or to truck­ers look­ing to cut costs, in­ves­ti­ga­tors and in­dus­try ex­perts say.

“It’s pretty ram­pant,” said Owen DeWitt, whose Texas-based com­pany, Know Con­trol, focuses solely on help­ing gas sta­tions pre­vent fuel theft. He said the crime is worst along In­ter­state 10, from Jack­sonville, Fla., to the Los An­ge­les area.

“Cal­i­for­nia and Florida are the two worst,” he said. “Texas is No. 3.”

Black-mar­ket diesel started be­com­ing a big busi­ness when credit card “skim­mers” be­came more preva­lent around 2006, DeWitt said. Thieves in­stall the de­vices at gas sta­tion pumps, where they record card in­forma- tion as un­sus­pect­ing cus­tomers fuel up.

The in­for­ma­tion is later trans­ferred to a mag­netic strip on a coun­ter­feit card, which can then be used to steal fuel.

The black mar­ket has grown quickly in p art be­cause the thefts to­tal a few hun­dred dol­lars at a time, and pros­e­cu­tors have been slow to pri­or­i­tize them. But as fuel thefts be­come more or­ga­nized, they have caught the at­ten­tion of state and fed­eral au­thor­i­ties around the coun­try.

State Agri­cul­ture and Con­sumer Ser­vices Com­mis­sioner Adam Put­nam’s depart­ment takes the lead on pros­e­cut­ing these crimes in Florida. He said they used to be con­sid­ered a “vic­tim- less” or “slap-on-the-wrist-type crime, and yet they were mak­ing more money do­ing this than a lot of other crim­i­nal ac­tiv­i­ties that had a lot higher sen­tences.”

The U.S. Se­cret Ser­vice, which in­ves­ti­gates fi­nan­cial crimes, is in­volved be­cause of the use of credit card skim­mers.

Agent Steve Scar­ince said Mi­ami, Los An­ge­les and Las Ve­gas are hot spots, to­gether ac­count­ing for about 20 mil­lion gal­lons a year in stolen diesel.

“The crews that we’ve in­ves­ti­gated over the past cou­ple of years — the least prof­itable group is $5 mil­lion a year. And then there are groups that will gross $20 mil­lion plus,” Scar­ince said. “The gang-bangers in Los An­ge­les have been mi­grat­ing to fi­nan­cial crimes in­stead of street crimes be­cause it’s much more prof­itable and if you get caught, you get pro­ba­tion.”

Court records from a sin- gle Se­cret Ser­vice case pros- ecuted in 2014 il­lus­trate how much money even a small crew can take in.

Agents in the Los An­ge­les area surveilled a group with seven pickup trucks and SUVs with hid­den fuel tanks hold­ing up to 300 gal- lons each. For 10 months, credit cardinfor­ma­tion stolen from about 900 peo­ple to fill up three times a day. They trans­ferred the diesel into a 4,500-gal­lon in­dus­trial fuel tanker that made daily runs to sell the fuel to gas sta­tions.

Agents es­ti­mated the group stole close to $16,000 in fuel ev­ery day, with the po­ten­tial to steal $7 mil­lion a year. Records in­di­cated it was in op­er­a­tion for about five years be­fore agents shut it down.

“Theft has been in­volved with fuel for as long as re­tail- ers have been sell­ing fuel,” said Jeff Le­nard, a vice pres­i­dent of the Na­tional As­so­ci­a­tion of Con­ve­nience Stores in Alexan­dria, Va.

But he said to­day’s crimi- nals are “try­ing to steal hun­dreds, if not thousands, of gal­lons.”

Thieves of­ten use dozens of fraud­u­lent cards at a time, in­sert­ing one af­ter an­other to fill up hid­den tanks. One gang used fraud­u­lent credit cards for a month to steal $100,000 in diesel from two sta­tions in cen­tral Florida.

In other cases, one thief parks a truck to block the clerk’s view while an­other pumps diesel di­rectly from an un­der­ground tank through a hole in the vehi- cle’s floor­boards, in­ves­tiga- tors say.

Texas Comptroller Glenn He­gar has pur­sued sell­ers of black mar­ket fuel for break­ing state mo­tor fuel tax eva­sion laws, se­cur­ing some stiff sen­tences: In 2015 alone, his of­fice worked to in­dict more than 100 sus­pected mo­tor fuel thieves. A Gor­man, Texas, man got 40 years in 2015, and a Haskell, Texas, man was sen­tenced to 10 years last Au­gust.


This pickup is fit­ted with a large tank that was used to siphon gas from fu­el­ing sta­tions us­ing stolen credit cards. Cal­i­for­nia, Florida and Texas are the three states with the high­est num­ber of fuel-theft crimes.

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