• BREAKING NEWS ABC shows live and on-demand -- Download the WATCH ABC app!

$7M worth of LA city fuel unaccounted for

March 29, 2012 12:00:00 AM PDT
The city of Los Angeles is having trouble explaining millions of dollars of missing gasoline and other fuels.

"What I uncovered is startling. We found millions of dollars of unexplained high-risk fuel transactions by city departments," said City Controller Wendy Greuel.

Greuel released the results of an audit on the city's fuel use Thursday. She said that some of the missing gasoline may have been used for personal vehicles. The audit showed that millions of gallons of fuel were pumped without any record of where it went, according to the audit.

She uses the term "high-risk" to refer to potential theft of city money with employees buying fuel illegally for personal vehicles, especially now that gasoline and other fuels have become so expensive.

"The best case scenario of this audit is that the department managers did a poor job in keeping records of the fuel. The worst case scenario is that there is theft of the city's fuel resources," Greuel said.

Greuel said Mayor Antonio Villaraigosa, and other L.A. City Council members and city department heads have been "asleep at the switch."

The unexplained fuel transactions happened despite a $12 million fuel tracking system put in place 10 years ago. Greuel said the audit shows that city departments do not use the tracking system effectively to monitor employees. The audit does show the LAPD is the only department that uses a system to regularly monitor fuel use by its employees.

The city spends nearly $29 million buying about 14 million gallons of gasoline, natural gas and diesel fuel to power vehicles including garbage trucks, helicopters and police cruisers. There are tracking systems in place, but they can be bypassed either manually or with so-called "master cards" assigned to each of the city's 141 fuel sites.

The tools to bypass the tracking system are supposed to be used only when normal systems fail. However, the audit found they were used to dispense millions of gallons of fuel over a 22-month period beginning in 2009.

The audit recommended restricting access to the overriding capability so most, if not all, of the fuel would be accounted for. Greuel also recommended that department leaders keep track of fuel cards to limit abuse.

Gruel has turned over the results of her audit to the city council along with recommendations on how to clean up the problem.

City News Service contributed to this report.

Load Comments