Police unravel wide web of fuel fraud

Police unravel wide web of fuel fraud

Crooks cook up gas scam and cheat country out of B5bn a year by selling household LPG to roadside filling stations

The misuse of cooking gas as vehicle fuel is keeping police busy in their investigations into illegal fuel retailing operations at the expense of the public purse.

Police became suspicious when the Energy Ministry reported a jump in demand for cooking gas in the past two years.

The demand is not consistent with the country's gross domestic product. It meant more cooking gas was being ordered than it was actually needed by households.

Police believed some of the gas was being misused for purposes other than for cooking.

The financial incentive for the abuse was telling. The government subsidises 12 baht for every kilogramme of LPG cooking gas sold at 18 baht. The subsidy is designed to ease the burden on the public.

The LPG gas for vehicles priced at 21 baht a kilogramme receives a state subsidy of 9 baht.

Pol Col Uthen Nuiphen, the lead investigator of a taskforce looking into illegal liquefied petroleum gas sales, said many business operators were profiteering from the higher subsidy for cooking gas.

The taskforce spent two months probing roadside gas stations. The investigation launched in January targeted 21 concessionaires who buy cooking LPG from PTT Plc, 474 gas packing facilities and about 1,500 roadside auto gas stations nationwide.

Pol Col Uthen said many irregularities came to light. The taskforce found that in the packing process, many cooking gas cylinder containers were left unused after all of the gas supply had been packed.

This led investigators to suspect the cooking gas unaccounted for had possibly been siphoned into a tanker and later sold to roadside gas stations.

Checks of documents showed some of the gas had been sold illegally by the packing facilities to roadside gas stations.

He said some facilities also forged invoices and claimed they had sent the gas to household cooking gas distributors when in fact they had sold the supplies to roadside gas stations.

Some packing facilities also own LPG auto gas stations while others set up bogus cooking gas companies which were actually agents to divert the supply to auto gas stations.

Pol Col Uthen said the scam has cost the state Oil Fund, which disburses the subsidies, up to 5 billion baht a year.

On May 2, police pressed fraud charges against 40 gas packing facilities, both owned by individuals and juristic entities.

On May 16, charges were laid against 30 additional facilities and 43 roadside auto gas stations. About 80 people have been charged in connection with the fraud. Offenders can jailed for up to 10 years and fined up to 100,000 baht.

He said the Oil Fund is also a damaged party and will file charges against the wrongdoers as well.

Pol Col Uthen's taskforce is made up of 21 experienced police officers who have worked on hundreds of cases to seize assets acquired using drug money.

Pol Col Uthen said the cases demand well-rounded knowledge and skills in gathering facts and investigation.

The team had to work quickly and get their attention to detail right.

He said he was confident police have conducted a watertight investigation that will win indictments from the prosecution.

However, he said misuse of LPG was a crime involving some major energy businesses. "The police are up against wealthy elements," Pol Col Uthen said.

The gas packing facilities were only interested in pocketing the state subsidies of gas, he said.

"There are figures lurking behind the scenes who have lots of money," he said.

Police are collecting evidence to try to bring the big fish to justice, Pol Col Uthen said.


Contact Crime Track: crimetrack@bangkokpost.co.th

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