Fleet Fuel Fraud Can’t Happen To You? Are You Sure About That?

In fleet fueling there are many ways your employees can steal fuel from you. Most companies truly believe, it can’t happen to me. There theory is we have someone that spot checks that information sometimes. Our drivers make good money they would never risk losing their jobs. Why would anyone want to steal from us, we take care of our employees. When it comes to fleet fuel the fuel is liquid cash when it comes to stealing. Everyone would like to believe they know their employees well enough to think that person won’t steal but it happens.

Below is an article from the Baltimore Sun. The article is in black print, comments from the Sokolis Group are in red print.

Theft of city fuel admitted
Public works driver resold more than 100,000 gallons of diesel

By Robbie Whelan Baltimore Sun reporter
April 1, 2010

A former Baltimore public works employee has pleaded guilty to stealing more than 100,000 gallons of diesel fuel from the city and reselling it as part of a scheme that went unnoticed for a year and a half. (I can assure you that if they had a good fuel inventory control process in place this would have been caught within 2 months)

Maurice Boone, 45, was found out Jan. 5, 2009, by a Baltimore County police officer who saw Boone filling several 250-gallon storage tanks with city-purchased diesel at a warehouse on Sparrows Point Road. The officer observed Boone while investigating a car-theft ring.

According to court records, Boone told police and an investigator from the city inspector general’s office that the plot had been going on since 2007. The tractor-trailer operator would fill a city tanker from a pump at a landfill on Quarantine Road; make several rounds filling city vehicles as part of his job, then sell the remaining fuel for $1 a gallon to an associate named Jimmy, who would leave money for him at the warehouse rendezvous point. The associate was identified in court documents as James Wright, who is a co-defendant in the case. (At this point in time diesel fuel was selling for over $4.00 a gallon at retail locations. I believe they were selling the fuel for more like $2.00 a gallon.)

Boone pleaded guilty Monday and will receive a suspended eight-year sentence and five years’ probation, records show. He must also pay the city $187,000 in restitution, but Baltimore Circuit Judge Lynn K. Stewart delayed sentencing until July, a month after Wright’s scheduled trial. (The Sokolis Group has nothing against Mr. Boone except you won’t find us hiring him what we are confused about is 100,000 gallons at even $2.00 a gallon is over $200,000. The average price per gallon of fuel over this time period had to be close to $3.00.)

Boone’s lawyer, Marc Minkove, said his client – who was fired from his city job in March 2009 – will testify against Wright “if he’s summoned.”

A charging document pegs the total amount of diesel that Boone stole at 101,305.4 gallons, but public works officials said they weren’t sure of the precise number. A spokesperson for the state’s attorney’s office said that the losses may have totaled as much as $1 million, but that prosecutors were unable to document the extent of the theft because of insufficient paperwork. (If public works officials don’t know what the amount is as stated they don’t, it is much higher than 101,305.4. How did they come up with the 101,305.4? They say the extent may have been close to $1 million so even at $3.00 a gallon for diesel fuel like we said above that would be a theft of at least 333,333 gallons. As a fuel management company, we would believe that number of 333,333 is more like the real number of fleet fuel stolen. As a fuel manager someone should have had some fuel inventory records to catch this amount of fleet fuel leaving the fuel tanks.)

“From our end, we never knew how much fuel the guy was actually stealing,” said Robert Murrow, a DPW spokesman.

Murrow added that fuel prices were rising, so the agency did not notice the high cost of diesel invoices being charged to its office. (Sokolis Group agrees fleet fuel prices were rising but that has nothing to do with your fuel inventory and fuel management. Fuel inventory is just like any other inventory, goods come in and goods go out. If you have 500 gallons of fleet fuel delivered, you need to know which vehicles your fleet fuel went. If it only comes out to 450 gallons of fleet fuel and you don’t have 50 gallons of fuel still left in the fuel tank, you have a problem. The fleet fuel pricing going higher is a matter of fuel auditing to make sure you paid the correct fuel price for what you bought. Most fuel managers at companies since that job is just part of many jobs don’t do a very good job at it because they don’t have access to the proper data to be able to understand the fuel market trends.)

Diesel hit a historic high of $4.76 per gallon the week of July 14, 2008, before dropping to $2.01 six months later, according to Department of Energy statistics.

The City should be ashamed of this. When there are fuel management companies out there that can manage all of your fleet fuel buying, fuel auditing, and fleet fuel pricing and checking for a whole lot less than $1 million dollars. For a couple of thousand dollars of month they could have been well service in fuel management by Sokolis Group or some other fleet fuel management company. Who knows who else is or was stealing fleet fuel from them? They don’t track their fuel inventory, so it could be millions of gallons of diesel fuel that has been stolen. Maybe before Boone started to steal fleet fuel from them there was someone else that told Boone how to do it. Do you have someone stealing fleet fuel from you? Are you sure? Do you have solid fuel inventory records? How about the prices of fleet fuel are you paying what you should be or are your fuel prices higher than they should be? Do you know?