The men, SFMTA mechanic Edmund King, 52, and Leroy Gutierrez, 53, both of San Francisco, were arrested July 15 outside the BART/Muni plaza at 16th and Mission streets, according to police and prosecutors.
According to police spokesman Sgt. Troy Dangerfield, police had been conducting surveillance of the area since March at the request of SFMTA officials. Several arrests were made in the area for illegally selling "late night" Muni transfers.
On July 15, officers were following Gutierrez, who they say had been arrested previously for selling transfers, and saw him meet King, who allegedly handed him transfers in a rolled-up newspaper, Dangerfield said.
Both men were arrested in possession of more than 80 transfers, according to Dangerfield.
Prosecutors have charged King with two felonies, possession of stolen property and embezzlement by a public employee, both of which carry potential prison terms, district attorney's office spokeswoman Erica Derryck said.
Gutierrez has been charged with felony possession of stolen property and misdemeanor possession of a knife.
Both men are due back in court July 30 for a preliminary hearing, Derryck said.
SFMTA spokesman Paul Rose said Friday that King has worked for the agency as an electrical transit mechanic for 24 years.
"We've recommended that he be removed from his position," pending a personnel hearing and the police investigation, Rose said.
According to police, the SFMTA loses thousands of dollars each week from the illegal sale of Muni bus and train transfers, which are often hocked at Muni stations for half price.
