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L.A. parks worker accused of selling city gasoline on black market

May 21, 2012 |  7:17 pm

A gardener for the city of Los Angeles has been arrested on suspicion of embezzlement for allegedly selling thousands of dollars of city-owned gasoline on the black market.

Michael Lee, a 12-year veteran of the Recreation and Parks Department, was arrested Monday along with another man who police say worked with him to steal the fuel. According to police, the pair were detained after officers watched Lee fill up portable gas cans at a city fueling site in South Los Angeles and transfer the cans into a private vehicle several blocks away.

Police allege that Lee and Shane Gansterer stole at least 800 gallons of fuel over the last three months, and they say the thefts may have been going on for even longer. A third man, who was not identified, was briefly detained but released.

Police were tipped off in early April when a caller contacted them after seeing a televised press conference in which City Controller Wendy Greuel announced that the city was missing $7 million worth of gasoline.

Greuel’s audit of city records and dozens of city fueling sites found that millions of gallons of fuel was pumped without any record of where it went.

Greuel found that most departments don't effectively track employees’ use of fuel, and she warned that some of the unaccounted-for gasoline may have been used for personal vehicles.

A similar audit conducted in 2009 by then-Controller Laura Chick also found serious gaps in the way the city tracks its fuel. Every year the city spends close to $29 million buying 14 million gallons of gasoline, natural gas and diesel fuel to power police cruisers, garbage trucks and helicopters, as well as light machinery like leaf blowers.


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-- Andrew Blankstein and Kate Linthicum