Freedom Fuel Stations Accused of Selling Unpaid Gas Promoted by Trump

A fuel supplier has filed a lawsuit alleging that some of the gasoline distributed through the Freedom Fuel Network, a chain that received praise from President Donald Trump for its low prices, was never paid for.

The lawsuit, initiated on August 19th by Georgia-based Mansfield Oil, claims that businessman Syed Kazmi and his company, KRSM, acquired over 1.1 million gallons of fuel from a Pennsylvania terminal between May and July. According to the suit, Mansfield Oil's invoice for this fuel, totaling approximately $4 million, remained unpaid in July.

The complaint further states that KRSM subsequently sold a portion of this fuel to stations operating under the Freedom Fuel Network. It's important to note that the lawsuit does not name the Freedom Fuel Network as a defendant, nor does it accuse the company of any wrongdoing.

Earlier in July, Freedom Fuel garnered attention by selling gas at $3.47 per gallon at 25 locations across Pennsylvania and New Jersey. This significantly lower price was presented as a tribute to President Trump's status as the 47th president. At the time, this offered a substantial discount compared to other local gas stations.

President Trump had promoted these discounted prices, suggesting they were an indicator that American consumers would soon see "record low prices" at the pump, despite rising global fuel costs attributed to the conflict with Iran.

"On July 3rd, the Freedom Fuel Network will be lowering gas prices at 25 'FREEDOM FUEL' Stations across the Greater Philadelphia Area," Trump had announced on Truth Social on July 1st. "This Retailer is taking the lead, and others should follow. They are doing this because they love the U.S.A."

Mansfield Oil alleges that the availability of unpaid fuel enabled at least some of these discounted sales. The lawsuit contends, "KRSM was able to sell such fuel for such low prices and garner such publicity because it never paid Plaintiff for such fuel."

On August 28th, the presiding judge partially granted Mansfield's request for a preliminary injunction, ordering the defendants to maintain a minimum bank account balance of $2.75 million, as indicated by court records.

The lawsuit does not specify the exact volume of the $4 million worth of gas that was supplied to Freedom Fuel stations, nor does it detail any direct relationship between these stations and KRSM or Syed Kazmi.

According to Politico, at least six Freedom Fuel locations in New Jersey are managed by Shamikh Kazmi, who is identified as the brother of the defendant, Syed Kazmi.

Mauro Tucci, the legal representative for KRSM, stated that the issue is essentially a dispute over invoice discrepancies. "KRSM disputes the allegations in this case, which is an accounting dispute over fuel invoices mis-priced by Mansfield Oil," he communicated via email to CNBC. "We will not be commenting further on this pending litigation."

White House officials informed CNBC that the administration has had no communication or dealings with the defendants. Freedom Fuel Network did not respond to CNBC's request for comment.