KXAN uncovers emissions fraud ‘way beyond’ what Texas authorities knew

  

AUSTIN (KXAN) — A KXAN investigation has uncovered obvious discrepancies and red flags in public vehicle inspection reports, revealing new details about the extent of emissions fraud in Texas — “way beyond” what law enforcement already knew — prompting a local task force to take action.

“[This goes] way beyond what I thought,” said Sgt. Jose Escribano, after reviewing KXAN’s findings. Escribano is a leading expert on emissions inspection fraud with the Travis County Constable Precinct 3 Clean Air Task Force.

As KXAN has previously investigated, emissions inspections are, in some cases, being bypassed with bribes. Escribano’s team estimates five million vehicles were illegally cleared in 2022 and 2023 — cars that shouldn’t be allowed on the road — in a process called “clean scanning.”

Last month at a Travis County Commissioners Court meeting, Escribano testified, without elaborating, that the Texas Information Management System — the statewide database of vehicle emissions inspections — was “dramatically compromised.”

KXAN dug through recent vehicle inspection reports filed with the Texas Commission on Environmental Quality (TCEQ).

We found data discrepancies with at least seven inspection stations, revealing new details about the extent of this fraud:

• The same unique business ID number being used at three different inspection stations in the Dallas area with some taking place on the same date, at the same time.
• The same equipment used to conduct emissions tests, called Test Analyzer Systems, is listed under separate inspections in the El Paso, Houston and Dallas regions. In one case, an inspection station in the El Paso area reported to TCEQ it used the same analyzer (which also has a unique ID number) on June 28 at 3:01 p.m. as another station more than 700 miles away, at the same time, in the Houston region.

“Same analyzer, at the same time, in two different cities? That’s impossible,” Escribano told KXAN at his Travis County office. “That shows you right there that, again, the system looks like it’s been compromised.”

The Texas Department of Public Safety agreed that what KXAN found cannot be possible — physically or legally.

“It is not possible the same analyzer could be used in two cities at the same time,” said DPS spokeswoman Sheridan Nolen.

As part of an operation dubbed “Red Picasso,” Escribano’s team obtained 24 arrest warrants in recent months for people suspected of trying to use fraudulent inspections to illegally register vehicles in Travis County. His task force is investigating more than 220 criminal cases, he said, with “more coming.”

“By the end of the year, I’m suspecting I’ll be in the upper 400s,” Escribano said, anticipating the number of arrest warrants that could be issued. “This is just Travis County. This is just the ones we know of. You have other tax offices not doing what we’re doing.”

The Travis County Tax Office — which will begin displaying warning videos in its offices saying, “Fake Vehicle Inspection DON’T FALL FOR IT!” — said it caught “about 200” bogus inspection reports since April.

Last November, KXAN was given access to an undercover sting operation at the Travis County Tax Office to see, firsthand, how bogus inspection reports obtained in other parts of the state are turning up in Austin.

“It’s organized crime,” said Escribano. “There’s no question about it.”

One question Escribano wants answered: Why didn’t the state’s system flag suspicious inspections — like ones KXAN found taking place at 3:35 a.m. and some lasting just seconds? One June safety inspection in the Dallas region started at 3:35:07 and ended seconds later at 3:35:38, public records show. Another record filed with the state shows an emissions and safety inspection from the Houston area reportedly lasting less than a minute.

“How does the system allow that?” Escribano asked, noting an average inspection should take 10 minutes.

He wants to know if the database has been hacked.

“Who takes responsibility for fixing the system?” he asked. “Your guess is good as mine.”

New tool could stop fraud in real-time

The Texas Department of Motor Vehicles and TCEQ referred questions about our findings to DPS. In a statement, DPS said it cannot discuss “ongoing criminal investigations” but noted it is “continuously investigating cases of clean scanning.”

In response to KXAN’s questions, DPS sent records showing it suspended or revoked 5,851 licenses for “clean scanning” between this year and last:

• In 2023, DPS made 49 arrests related to vehicle inspection fraud.
• So far in 2024, DPS made 17 arrests related to vehicle inspection fraud.
• In 2023, DPS revoked the licenses for 1,764 inspectors and 129 stations.
• In 2023, DPS suspended the licenses for 1,783 inspectors and 1,358 stations.
• So far this year, DPS revoked the licenses for 446 inspectors and 371 stations. None were suspended.

DPS and TCEQ said they have worked jointly on a project since late last year aimed at combatting inspection fraud in real-time. A tool being tested, called Real-time Inspection Interruption, or RTI, would “cause a vehicle to fail its emissions inspection when fraud is detected,” TCEQ said.

Seven years after TCEQ admitted it was aware of fraud tied to emissions inspections, the new tool is being pilot-tested. That is expected to be completed by the end of the year.

“Implementation of the RTI features will be at the discretion of DPS,” TCEQ spokesman Ricky Richter said.

‘Falsified reports’

KXAN is not naming any of the inspection stations where we found discrepancies. We did, however, pass along our findings to Escribano, DPS, TCEQ, the TxDMV, and the inspection stations that we could locate.

Four of the stations are now looking into what KXAN found. This is what the ones who responded told us:

• National vehicle inspection chain #1: “We were made aware of a similar situation in February of this year and have been working with the Texas Department of Public Safety as they investigate the discrepancies in emissions and safety inspections. We take fraud allegations extremely seriously, and law enforcement and the state regulating bodies have our full cooperation as they continue to examine the data and systems.”
• National vehicle inspection chain #2: “We aim to be the most trusted provider of tire and automotive care in every neighborhood we serve and take compliance with the law very seriously. We are conducting an internal investigation into this matter and are unable to share any additional information at this time.” A follow up e-mail said: “Compliance with the law remains a top priority for (our) Operations and we appreciate you bringing this matter to our attention. After further investigation, including discussing this matter with the Texas Commission on Environmental Quality, we learned that the inspection reports you provided were apparently falsified reports created by a 3rd party who is unaffiliated with (us) and not authorized to use (our) name. We are evaluating our legal options to ensure this 3rd party no longer uses (the brand’s) name.”
• Fort Worth car dealership #3: “As far as how that would happen I have no idea….I don’t know how that would be possible. It just doesn’t make sense.”
• Fort Worth car repair shop #4: A manager said what we found is “a bit concerning” and feared it would be hard to catch criminals “operating under other people’s analyzer.” The only way to get that analyzer ID number is to physically be at the station.

‘So dangerous’

Experts say vehicles spewing soot and smog are not only polluting the air we breathe but also causing real health concerns.

“Why should people care about vehicles that are on the road that are failing these emissions tests?” KXAN investigative reporter Matt Grant asked.

“We’re talking ultra-fine, coarse particles, many of which can just go right through the blood barrier, into your bloodstream, or get lodged in your lungs,” said the American Lung Association in Texas’ advocacy director, Charlie Gagen. “And, so, if you are someone who already is dealing with lung issues, we’re talking increased risk of cardiovascular and respiratory disease and a worsening of various heart diseases, a higher likelihood of developing diabetes and other complications.”

Gagen recommends monitoring air quality and taking precautions on days that are listed as being poor.

“That’s why the federal government actually regulates many of these. Because they are so dangerous,” he added. “It really just wrecks the whole body.”

It’s why emissions tests are required in 17 Texas counties to comply with federal clean air standards.

While safety inspections will go away next year, emissions tests won’t.

Between last year and 2022, Austin had 38 Ozone Action Days — the most since 2008, when records were first tracked. In February, the Environmental Protection Agency issued stronger air quality standards for soot, putting Travis County over the limit for what’s acceptable. The EPA projects Travis County will be one of the counties nationwide that will not meet the new air pollution standard by 2032.

“At this time, we would not be able to confirm whether Travis county will be labeled nonattainment,” an EPA spokesman said in a statement. “To look at specific areas air quality data, please view our AIRNOW webpage.”

Asked about emissions fraud, the EPA would only say it is “working with our state partners to protect air quality.” The EPA said TCEQ has a “responsibility” to develop “plans for addressing air quality concerns.”

“The final EPA rules will not be available until EPA announces them. It is too early to speculate how they will affect Travis County,” Travis County spokesperson Hector Nieto said. “While we wait for the rules to become final and available, Travis County will continue to do its part to help mitigate the causes of air pollution. This includes transitioning to an all-electric vehicle fleet and providing electric vehicle charging stations. Additionally, Travis County provides incentives for employees to use public transportation, flexible work schedules, and adaptive workplace positions.”

“We encourage other public and private entities to do the same,” Nieto added, “and for the public to properly maintain their vehicles and keep them up to date with their emissions tests.”