April Fools … Credit Card Skimmers and Fuel Tax Fraud

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No ones likes to be fooled, but we all know there are scams out there in this day and age.  One particular scheme that has been popular recently throughout northern and eastern Texas is credit card skimmers at gas stations – coupled with fuel tax evasion.  I have represented many defendants charged with a range of offenses that stem from this type of conduct. What are these activities and what does Hindieh Law do to fight back against the prosecution when defendant’s are accused of these crimes?

                Let’s dig into the actual nuts and bolts of this type of criminal conduct.  It has been a popular scheme now in Texas for some time to swap out the credit card reader at a gas station gas pump with a credit card skimmer.  The individual will swap out the reader with a skimmer, and take the credit card information.  At the same time, they will use the activated gas pump to pump free gas into a tanker truck or other storage space.  They will use the credit card info they’ve obtained to make other fraudulent purchases, and sell or use the gas they took.  I have had many clients engage in this scheme… but what are the charges that someone can face from this type of conduct?

                The first is likely to be the most obvious – credit card abuse.  Credit card abuse is a charge in Texas that results from the unauthorized use of a credit or debit card to make purchases for goods or services unbeknownst to the card holder.  The cases are almost always charged as a felony, and the degree of the felony is typically dependent upon the amount of the purchases charged to the card.  Depending on the amount taken, it can add up to a first degree felony.  Also, there are other enhancing factors – such as the age of the complainant (the card holder). If the complainant is over the age of 65 years old, then the charge can be upgraded one level higher, as it is considered to be “credit card abuse on an elderly person.”  To prove this charge up the state has to show that the defendant enriched themselves but using credit card information that was not there’s to use – which can be harder than you think.  Typically this involves being caught in the act. The police lack the resources and the bandwidth to track down where an amazon package is going to, so even when they know property is going to a potential thief, they will only act on an arrest when they catch the person in the act.  I had a case once in Van Zandt County where they couldn’t charge my client with credit card abuse because even though they were in possession of credit card skimming devices, there was no evidence they had used them to enrich themselves to the detriment of a particular card holder. They probably had been used. They just couldn’t prove it.  Instead, they were charged with unlawful use of a criminal instrument.  I was able to plead down the case to a misdemeanor on this less serious charge because it is harder to prove.  Timing is everything in life, and nothing is different about timing when it comes to criminal law.

                I just mentioned the charge of unlawful use of a criminal instrument above.  This type of charge is usually focused on the credit card skimming devices themselves.  But there’s more to it than that.  Take an ordinary screwdriver.  In and of itself, it is NOT an ILLEGAL instrument.  It’s a tool that nearly every American has or has access to.  Take the classic burglar who uses the screwdriver to jimmy a lock to a house in order to break into the house and take valuables inside. In this burglary scenario, the burglar can be charged with the mere possession of the screwdriver under the charge of unlawful use of a criminal instrument if, and only if, the state can prove that the instrument was being used in some criminal enterprise.  Now, at a glance, credit card skimmers are easier for the state to prove, they are basically invented for one singular purpose – which is entirely criminal.  But the analysis doesn’t end there.  Possession of a credit card skimmer may seem like a slam dunk case for the prosecution.  But that’s when you attack the case on more traditional grounds.  In the above case I mentioned in Van Zandt County, the police officer pulled over my client and asked for consent to search the car – which my client consented to.  The cop found an entire bag of credit card skimmers. My client was charged with felony unlawful use of a criminal instrument… BUT, I was able to get the case plead down to a simple misdemeanor because of the reason for the stop.  The officer had claimed that my client had stayed in the left passing lane for too long and so had violated the traffic ordinance of “left lane for passing only.”  I filed a motion to suppress the stop based on the lack of notice of regular road signs posted for “left lane passing only.”  On the eve of our suppression hearing, the prosecutor caved in, and offered a misdemeanor instead of risking the whole case on a hearing.  The client was happy because he beat the unlawful use of a criminal instrument charge – instead he walked away with just a misdemeanor.

                The last charge that can result from this type of criminal scheme is also the easiest to fight: Motor Fuel Tax Evasion.  When the person uses the credit card skimmer to take the card info and pump free gas from the gas pump, they are not only stealing the gas from the credit card holder – they are also failing to pay motor fuel tax to the appropriate state authorities for the gas that they pump.  This seems pretty straightforward, right?  I put a credit card skimmer in a gas pump.  I steal a credit card number.  I use that credit card info to activate the gas pump and BOOM.. free gas that I didn’t pay a dime of fuel tax on.  Except – here’s the problem for the state.  If a pick pocket steals your wallet, the stolen item is going to very easy to identify.  It’s YOUR wallet. It’s got your license in it.  The debit card has your name on it.  Even if all your stuff is taken out I’ll bet you could describe your wallet in detail to a sketch artist without any problem because you handle the item all day every day.  With fuel, we have no idea what portion of the fuel is stolen – if any.  I had a case in Dallas where my client was stopped at the gas station IN THE ACT of committing the entire scheme. It was a police sting where four guys had been under surveillance for the whole day.  They found his credit card skimmers in the pump.  They could prove from the video that he had been the one that placed them in the pumps.  They knew that other people had been defrauded at other pumps, and oh, he had a whole tanker full of gas.  While I was able to plead down the other charges, I actually got the state to dismiss the motor fuel tax evasion charge altogether.  This is because the police and prosecutors could never prove if any of the gas in the tanker was stolen gas.  As far as we were concerned, it was equally likely that my client was skimming credit cards but that THIS particular gas in this tanker was paid for lawfully.  They couldn’t prove it otherwise.  Had he used the card info to pump gas without paying tax on it in the past?  Sure, they knew he had used someone else’s credit card info to buy gas at another location. That HAS to be the gas in the tanker, right?  Prove it.  As far as we were concerned that gas had long since gone up in smoke – literally.  This is what makes motor fuel tax evasion such as difficult charge for the state to prove – and it’s one of the pressure points we squeeze in defending clients charged out of these schemes.                 Have you gotten involved in one these types of operations and the result has been arrest and a charge? Call Hindieh Law today for a consult. We’ve handled many of these types of cases and are well versed on how to defend you against them.  Call us today and take b

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