Thieves find a lucrative new commodity - grease

Posted Friday, May. 02, 2014  comments  Print Reprints
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In darkened alleyways, a slimy cat-and-mouse game is playing out in Texas and across America.

Men in trucks are fighting over a dirty and sometimes foul-smelling substance that restaurants once paid to get hauled off. Now it can be worth thousands per truckload. Liquid gold, some in the trade call it.

It’s grease — used kitchen cooking oil from deep fryers at KFC and the seasoned saucepans of the fanciest French restaurant.

The increasingly consolidated industry, ranging from mom and pop operations to publicly traded giants, is marked by cutthroat competition to claim restaurant accounts. And all of them have to grab their grease before a ragtag swarm of thieves gets there first.

“This one is pretty clean,” Clay Carrillo-Miranda of Haltom City’s Best Grease Service said on his second-to-last stop of the day when he pumped out thick gunk from a container behind the J&J Oyster Bar near West Seventh Street and University Drive in Fort Worth. “Some stink so bad you want to throw up. When it’s 105 degrees, this job isn’t a lot of fun, so that’s when I go out at night.”

And after sundown is when the thieves usually strike — and fast.

“You can pull in and drive off in five minutes. It can be $500 a night, $2,500 a week,” said Carrillo-Miranda, 37, a beefy man in a black T-shirt and jean shorts. “Even if your truck gets impounded, that’s $500. You’re still ahead $2,000 for the week.”

A 15-year veteran of the oil-recycling business, he spends several nights a month on stakeouts behind restaurants that contract with his employer. He has lost count of the locks he’s replaced because of thieves with bolt cutters. His boss, Brian Smith, says a Burleson man was caught using the firefighters’ Jaws of Life to break into tanks.

Licensed collectors have used surveillance cameras, extra-heavy metal lids and off-duty cops to protect their routes while lobbying for better local enforcement and stronger state laws. In a sign of how aggressive the grease war has become, a dozen production companies are looking into creating reality TV episodes.

Theft is growing

Chris Griffin, deputy general counsel for Irving-based Darling International and its Griffin Industries unit, a national recycler, conservatively estimates that 20 percent of its used kitchen grease is stolen each year.

The thefts are fueled in part by growing demand for renewable diesel. Darling and Valero opened the country’s largest renewable diesel plant last year in Norco, La., with an annual capacity of 142 million gallons. Before, the grease was mainly used for lubricants, soap and animal feed.

When soybean prices spiked because of the drought in 2012, demand for used cooking grease for biofuel production rose, according to a 2013 industry study by IBIS World. The research firm estimated that sales last year reached $1.3 billion, and it predicted annual growth of 1.7 percent through 2018.

The industry has successfully lobbied legislatures in California, Virginia and North Carolina to pass stronger laws against grease theft. In Virginia, any company that buys more than 55 gallons of grease from an unregistered transporter can be fined $5,000.

And it can become a federal crime. In January 2013, Missouri grease dealer Jesse Arnold was sentenced to 10 years in federal prison and required to forfeit $207,817 made from buying oil stolen in Missouri, Oklahoma, Kansas and Arkansas.

Thievery escalates whenever the commodity price rises, said Jason Satterfield, 35, owner of Black Sheep Grease of Aurora, between Fort Worth and Decatur.

Satterfield attributes a sizable portion of a $50,000 drop in revenue last year to grease stolen from his tanks behind restaurants with which he has contracts.

“I had to lay off two fantastic guys as a result,” he said. It got so bad that he co-founded a side business manufacturing tanks that are harder to break into.

But Darling discounts the impact of high commodity prices.

“I don’t believe grease theft ebbs and flows with market fluctuations,” said Griffin, whose grandfather founded Kentucky-based Griffin Industries, which was acquired by Darling, its biggest rival, in December 2010. “Grease theft is a long-standing industry problem and has been around for as long as the company has been in business [71 years].”

What’s known is that it doesn’t cost much to become a grease thief — about $75 for a “trash” pump and less than $50 for a used tank, said Jerry Duty, a third-generation collector who operates Lil Grease Monsters in Grand Prairie.

All the companies interviewed agree that police and prosecutors in many jurisdictions just don’t see a crime, or one worth pursuing.

To some police departments, grease is garbage, Carrillo-Miranda complained.

Duty said: “Five years ago, I caught a guy three times stealing in Coppell. A cop tells me, ‘I can’t arrest him. It’s only trash.’ 

Pretty pricey trash.

“After they started making biodiesel from it, it became a lucrative market,” said Smith, of Best Grease. “From $40 to $50 for a 55-gallon drum of dirty grease, it tripled overnight, hitting a peak of $150, and we’d pay the restaurants half, $75. Years ago, they paid us to take it away.”

Smith said he now receives about $100 a barrel.

“It’s a lucrative business, but the theft can be outrageous,” Smith said. “At times, we lose $500 to $1,000 a week. Some weeks, we’ve had $3,000 worth of grease stolen. It’s hard to patrol 1,200 customers.”

Tough to prosecute

A 2013 New Yorker article on the break-ins — and the ceaseless hands-on efforts to combat them — prompted 12 TV production companies to express interest in creating reality TV episodes, said Jon Jaworski, a Houston lawyer who has defended numerous grease theft suspects in the past 25 years.

Ten of his clients have already signed contracts to participate. How does he know? Jaworski also serves as their agent.

One client, Michael James Ray Johnson, faces a Class A misdemeanor charge in Denton County on allegations that he stole grease from a Sonic Drive-In in Lewisville.

A mistrial was declared when a police officer gave inadmissible testimony from the witness stand, the court said. A new trial has been set for May 19. If convicted, the 23-year-old could face up to a year in the county jail and a $4,000 fine.

Jaworski said the underground trade is big enough that the nation’s largest collector, Darling, through its Dar Pro and Griffin units, is contracting retired and off-duty police officers to rein it in.

One of them, former San Antonio officer Larry Findley, wrote a strategy paper in the 1990s for Griffin that Jaworski obtained and has used as evidence “whenever the judge allows it.” It disclosed that not all grease thieves are good ol’ boys in pickups. Stealing grease were a Houston police officer and a veterinary compliance officer with the state, he wrote.

Many legitimate grease collectors themselves started out by stealing, Smith said. Then they signed contracts with restaurants and began cooperating with investigators hired by Darling to protect their business, he said.

“If they are stealing from us, they’re stealing from them,” Smith said, referring to the common threat. “And Darling is willing to help out the smaller people. We are able to figure out who’s involved, and they have more resources to have people prosecuted than we do.”

Securing a conviction can be difficult.

Jaworski said he has won acquittals by arguing that neither the restaurant nor the contracted collector was able to determine how much, if any, of the grease found in his client’s truck-borne tank was stolen. “You can’t tell by the grease line what was in it before.”

In the Lewisville case, there was a dispute over just who owned the grease in the first place, he said. “The [Sonic franchise] owner’s son is saying, ‘It’s our grease.’ Darling says it’s theirs.”

And a conviction doesn’t guarantee stopping the thief.

“The company is aware of several career criminals in different jurisdictions that have been convicted of grease theft multiple times, and it is not a matter of if they will try to steal grease again, but when,” Darling’s Griffin said in an email.

‘Livelihood is at stake’

Like many in the trade, Carrillo-Miranda admits that he lifted grease belonging to others early in his career.

“I’ve done it,” he said. “Not something I’m really proud of it.”

He quit that job because he couldn’t face his children, whom he was trying to raise to be upright.

He even spent a few hours in jail when caught once. “You reach a point in life where you have to act like a civilized human being.”

Carrillo-Miranda left the business for a few years, then got an offer to come back, insisting that there would be no thieving.

Still, the Wichita Falls native said he understands the lure. “It’s like picking up a $100 bill off the sidewalk. Wouldn’t you do it?”

Today, he’s determined to stop grease theft and is willing to sit hours on stakeouts to protect his boss’s tanks, blocking in thieves with his truck.

“My livelihood is at stake,” Carrillo-Miranda said. “I called the Fort Worth police one night, and the officer said, ‘It’s only grease,’ and not worth following up.

“But if someone is trying to steal your paycheck and getting no help from the police or the state of Texas, I’m not going to sit there and let my family starve.”

Barry Shlachter, 817-390-7718 Twitter: @bshlachter

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