NYC Cabbies Scam $8 Mil from Passengers!
By DAVID SEIFMAN City Hall Bureau Chief
In a mind-boggling rip off that went undetected for years, thousands of city cabbies overcharged nearly 2 million passengers by at least $8.3 million, according to a shocking disclosure yesterday by the Taxi & Limousine Commission.
Officials said 35,558 of the city's 48,300 taxi drivers -- or three-quarters of all the licensees -- were caught overcharging at least once by secretly changing the meter's rate setting.
A staggering 3,000 drivers swindled passengers more than 100 times each. A total of 1.9 million trips were overpriced. The scale of the thievery over the last 26 months was flabbergasting even to hardened veterans of what is supposed to be a tightly regulated industry.
"Oh, my God!" exclaimed one taxi official.
"When I first heard one guy was doing this, I said there has to be more. But I really didn't expect this."
He was referring to Wasim Khalid Cheema, who lost his hack license earlier this month after authorities found he had cheated 574 passengers in just one month -- this past July -- by setting his meter to Rate Code 4, covering Westchester and Nassau counties, instead of Rate Code 1, the default setting for trips inside the five boroughs. The suburban rate is double the in-city rate.
The remarkably simple scam netted Cheema an extra $40,000 over six months.
It came to light last year only after a suspicious passenger complained that a 12-minute trip from Manhattan to Queens cost $20.20, about double what she expected.
TLC officials then began comparing data from GPS devices in each cab with meter receipts and made the shocking discovery that the ripoffs were more rampant than anyone could have imagined.
"It would be purely speculative, but I can't believe this was organized," said one city official. "Perhaps there was some word of mouth."
Since GPS devices were only installed over the last couple of years, officials conceded that the wholesale rip-offs could date back years. The official amount stolen came to $8,330,155 in 1,872,078 trips -- an average of $4.45 per trip.
But officials said they couldn't collect data from one of the three meter vendors that account for about 10 percent of the accounts, so the actual thefts were undoubtedly greater.
As a short-term solution, officials said that within the next two weeks, meters would be equipped with a highly visible alert when Rate Code 4 is activated.
In the long term, officials are exploring a technology to block the suburban rate from being charged within the city. TLC spokesman Allan Fromberg said the agency is also considering whether there's a way to refund the overcharges.
Irate passengers wondered what took TLC so long to unravel the scheme. "They're putting cameras in cabs, TVs in cabs -- why haven't they checked this?" asked Simone Simmons, 31, a marketing associate who rides cabs regularly from Manhattan to her home in the Soundview section of The Bronx.
She said the trip sometimes cost $20, sometimes $30 -- at the same time of day, with the same traffic.
"I must have lost thousands," she fumed. "I'm outraged."
Additional reporting by Rebecca Rosenberg and Douglas Montero