Audit reveals Las Vegas taxis overcharge passengers $47 Million a year
Las Vegas taxi cabs are taking advantage of their customers to the tune of $47 Million a year, according to a recent audit of the Nevada Taxicab Authority, the organization responsible for overseeing taxi operations in Clark County.
Auditors say that the NTA takes advantage of passengers in two unheard of ways: By charging each customer paying by credit card a $3 fee to process the transaction, and by actually increasing the mandatory fuel surcharge, even as oil prices have plummeted to generational lows.
Union organizer Sam Moffitt says the credit-card processing fee is ludicrous, and not at all beneficial to the drivers themselves. He tells The Las Vegas Sun:
"It is absolutely, utterly ridiculous to have a credit card fee of $3. That's absurd. The drivers do not get any portion of that money."
Auditors pointed out that a similar credit-card processing fee charged to state organizations in Nevada by the bank Wells Fargo amounts to just 8.5 cents per transaction, and that comparable taxi agencies operating in other cities in the western United States charge customers between 3.8% and 5% of the base fare as a processing fee. A flat, $3 fee is outrageous compared to standard industry practices.
Thankfully, with the legalization of Uber and Lyft in Las Vegas, consumers now have an alternative, though those companies offer passengers their own sets of hurdles.
Beyond the two systemic worst-practices in play in Sin City, auditors also report that roughly a quarter of all taxi rides take an unnecessarily long route in order to jack up prices — and have been doing so for years.
The audit found the NTA's consumer abuses to be so egregious, that auditors have formally recommended the outright abolishment of the entire agency. Instead, they argue, another authoritative body should assume the responsibilities of overseeing the Las Vegas taxi market. Even the agency itself agrees with the ruling. Ron Grogan, head of the Nevada Taxicab Authority admitted that his agency "had probably outlasted its usefulness."