Aspen Police Department probes parking scam
September 25, 2014
The Aspen Police Department has opened an investigation into a parking-meter scam that has resulted in an estimated $600,000 in unpaid debt since 2010, officials announced Wednesday.
Investigators are working with Toronto-based vendor Precise Parklink Inc., which manufactured the parking meters, as well as Aspen's Finance and Parking departments, to determine the total amount of loss and the cards associated with the unpaid debt. Detectives are considering whether to investigate the infractions as theft or credit-card fraud, which is a felony, according to a Police Department statement.
On Monday, City Manager Steve Barwick told the Aspen City Council that in some cases, one perpetrator used the same invalid card to purchase multiple parking tickets. Barwick assumed that the tickets were then handed out to friends, employees or co-workers.
"We will be thorough and exhaust all avenues," Detective Walter Chi said in the statement. "There is a lot of information that we need to get from vendors before we can even begin to think about charging anyone."
The department anticipates a "slow-moving" case because of the volume and the length of time in which the declined transactions occurred. Spokeswoman Blair Weyer said that although the department has handled credit-card crimes and fraud in the past, this particular case is new territory.
"It's a new situation," she said, noting the amount of data and the various departments involved.
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Parking Department officials have known since 2007 that the system was susceptible to the scam in which drivers used maxed-out prepaid debit cards to gain free parking. This method was possible because the invalid cards were not declined until the end of the day, even though parking was granted.
The city initially blacklisted invalid cards, which made them unusable after the first unpaid debt. However, due to changes in Payment Card Industry standards over time, the city's ability to store and blacklist a particular card number was eliminated. The city's latest attempt to end the scam involves blocking all prepaid cards that carry a common set of digits.
Parking Director Tim Ware said that widespread fraud wasn't realized until around Labor Day, but looking at data now, the city should have caught on in late 2012.
"If we had been trying to extract information back then on this, it would have been apparent," he said, adding that there were no red flags because parking revenue saw no decline, as Barwick pointed out Monday.
Finance Director Don Taylor said his department learned of the problem by checking a monthly spreadsheet that shows declined and accepted transactions. In 2010 and 2011, declined transactions accounted for about 2 percent of all transactions, he said. But as more drivers learned of the scam, that amount grew, with declined transactions most recently accounting for about 30 percent of the total.
The city estimates about $817,000 in unpaid debt since 2010, but Taylor attributes about $121,000 to non-fraudulent transactions made by motorists ignorant to the scam. His office estimates unpaid debts of $26,580 in 2010, $37,800 in 2011, $78,036 in 2012, $227,220 in 2013 and $448,000 so far in 2014.
Earlier this week, the council approved an expenditure of more than $600,000 for a new 81-station parking system, which is expected to be installed in December.