July 23,2004

Grassley: Miami Arrests Make Fresh Case for Anti-fuel Fraud Reforms


To: Reporters and Editors
Re: Anti-fuel fraud provisions
Da: Friday, July 23, 2004

This week, prosecutors in Miami charged 19 workers at Miami International Airport with falsely classifying jet fuel as contaminated and then selling it on the sly, stealing 2.7 million gallonsof fuel. Sen. Chuck Grassley, chairman of the Committee on Finance, today said the arrests makea fresh case for enacting his bipartisan reforms to prevent fuel fraud. Grassley worked to includethe reforms in the pending highway re-authorization bill and in the Jumpstart Our Business Strength(JOBS) Act, which won full Senate passage in May on an overwhelming vote of 92 to 5 and awaitsconsideration in a House-Senate conference committee. Grassley made the following comment onthe need for the anti-fuel fraud provisions.

“The story of this week’s arrests is something out of ‘Miami Vice.’ The allegations ofwidespread theft, conspiracy, and kickbacks are shocking. What’s even more shocking is that thisscene is played out all over the country, probably every day. The federal taxpayers lose $1 billiona year to fuel fraud, and probably half of that is in jet fuel fraud. Those who steal fuel aren’t payingfederal excise taxes. We pay for all of our highways and airport infrastructure with fuel excise tax.That loss is unfair to honest taxpayers who have to make up the difference. In addition to the taxloss, it’s a national security risk for dangerous jet fuel to move around with no accountability.

“The bad guys seem to be getting more and more brazen. On September 11, after thenation’s planes were grounded, huge volumes of jet fuel use were reported even though no planeswere flying. That raised red flags for me and other watchdogs. My committee started investigatingand working with experts in the field. The result is the anti-fuel fraud provisions pending inCongress. I hope for final approval of these provisions as soon as possible to nip the growingproblem of fuel fraud in the bud.”