Grand theft fuel: The most popular frauds with corporate fuel cards

fuel card use
See how employees use corporate fuel cards to steal fuel for personal use.

Using a fuel card becomes a regular thing, but it will either save your money or take it all. It’s up to you to decide. 

A corporate fuel card looks just like your average credit card, but you can only use it to pay for fuel.

So why would anyone have a separate card for fuel? 

Such cards are issued to corporate clients. These companies then give fuel cards to drivers. Both the drivers and fleet managers have reasons to use them:     

– Drivers don’t have to pay their own money to refill a corporate vehicle and track expenses for reimbursement. It only takes a card swipe to start filling. 

– The company sees how much fuel they filled and pays directly to a fuel card service provider by bank transfer. Plus, they see the exact time, date, and location of each transaction updated online.

Drivers focus on their work – keeping to routes, schedules, and driving responsibly – and are not distracted by money issues. Companies get all transactions to their computers and can plan fuel expenses for a longer period.    

The above is a win-win situation between drivers and the company, but only until the fuel card is not used for fraud. Fuel card frauds are tricky, and you can’t detect them easily. Especially when you have a large fleet

This happened to one of KLOUDIP’s clients and wouldn’t ever be detected without high-precision fuel level sensors. Let’s have a closer look. 

How do fuel card frauds happen?

A large online shopping company connected 100 transport and delivery vehicles to the GPS tracking and fleet management system by KLOUDIP. The trucks and pickups move across the country – the mileage and fuel expenses to cross it 100 times a day are enormous.

To cut fuel costs and control fuel consumption, KLOUDIP installed high-accuracy fuel level sensors into the vehicles. The sensors send data on the fuel levels in each vehicle, fillings, and thefts to the control center in Colombo. After the installation, traditional fuel thefts ended, until KLOUDIP drew attention to fuel cards. 

How do fuel cards help to steal fuel?

Fuel card frauds are way smarter than traditional fuel thefts. That’s how they happen. 

Before connecting vehicles to fleet management software, KLOUDIP’s client used fuel cards to control fuel fillings. The company trusted it for years and was sure to get accurate data. 

After connecting vehicles to fleet management software, the company decided to compare the amounts of fuel filled according to a fuel level sensor and a fuel card. KLOUDIP integrated the FiOS fleet management platform and a corporate fuel card software to display all the fuel level data in their system. Here’s what it looks like: 

Fuel data in FiOS fleet management system report
Fuel report in FiOS fleet management platform

Since the first report, fleet managers noticed significant differences in “Fuel filled” values detected by the fuel level sensor and the number of liters and cost spent on a fuel card. From 2 to 15 liters per filling were disappearing from the tank. 

Data in FiOS fleet management system fuel report vs. fuel card
Difference between the fuel filled according to the fleet management platform and fuel card provider

Reasons for fuel data inconsistencies

  1. Defective fuel level sensors 
  2. Bad integration between fleet management and fuel card systems
  3. Fuel card frauds

KLOUDIP checked and set aside the first two cases and had a meeting on the third one.  

  1. The fuel level sensor is well-calibrated and showed 98% accuracy. 
  2. Zero errors in data transmission. 

KLOUDIP assumed the drivers were making quick cash by filling less or not filling anything into a tank. Instead, they filled canisters or just received cash from petrol station employees, who bought the fuel from them at a half price. 

To prove that, KLOUDIP Customer Success Team ran an analysis on the fleet management platform. And found some interesting details. 

Cases of fuel card fraud across

Case 1. The system shows that the driver swiped the card and started fuel filling. But fuel level sensors detected no filling.

KLOUDIP checked the time and date of the filling and detected the vehicle’s location at that time. It appeared that vehicle never visited the filling station. The driver went there on a private car or foot, swiped the card, and got free fuel for personal needs or cash from the filling station employee.    

The locations of filling fuel and swiping fuel cards

Case 2. The major variation between what was detected by a fuel level sensor and what was spent on a fuel level card. 

To show the client that the fuel sensor shows correct values, KLOUDIP asked him to send one of his trustworthy employees and fill fuel to the tank using the fuel card. If an employee fills 30 liters with a card, and a sensor shows 29.1, the driver was cheating. In this case, the driver again filled some liters in the vehicle fuel tank and put the rest of the fuel into his “little fuel storage can.” 

And there are other possibilities.

How to avoid this? Don’t fly blind with the fuel cards. Have a fuel level sensor installed in your vehicles, monitor them closely, study reports and consumption patterns, analyze stops, and idling, and reduce harsh driving. Check out all the advice on fuel economy here. We guarantee that you will save 25-30% of your monthly fuel bill. Contact us to learn more.

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