Beware at the pump: Black market fuel is making millions – Waco Tribune-Herald

TALLAHASSEE, Fla. A black market for diesel and gasoline has rapidly spread around the nation, with organized crime gangs using fraudulent credit cards to syphon 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 re-selling the stolen fuel at construction sites and unscrupulous gas stations, or to truckers looking to cut costs, investigators and industry experts say.

Its 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; 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 these devices at gas station pumps, where they record card information as unsuspecting customers fuel up. The information is later transferred to a magnetic strip on a counterfeit card. The problem has only grown as the devices become more sophisticated.

The black market has grown quickly in part because the thefts total a few hundred dollars at a time, and prosecutors were slow to prioritize them.

Agriculture and Consumer Services Commissioner Adam Putnams department takes the lead on prosecuting these crimes in Florida. He said they used to be considered a victimless 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 the gangs use credit card skimmers. Agent Steve Scarince says Miami, Los Angeles and Las Vegas are hot spots, together accounting for about 20 million gallons a year in stolen diesel.

The crews that weve 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 its much more profitable and if you get caught, you get probation.

Agents in the Los Angeles area surveilled a group with seven pickup trucks and SUVs with hidden fuel tanks holding up to 300 gallons each. For 10 months, they observed drivers using credit card information 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 they 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.

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Beware at the pump: Black market fuel is making millions - Waco Tribune-Herald