Tuesday, February 9, 2016

Eight More Pilot Employees Indicted in Rebate Fraud

By Walter F. Roche Jr.

A federal grand jury has indicted eight former Pilot Travel employees, including the former president and the top sales executive, on mail and wire fraud charges stemming from rebate fraud allegations.
The indictments bring to 18 the number of one time Pilot employees to be charged in a scheme to cheat truckers out of millions of dollars in promised rebates.
The indictment dated Feb. 3, but not released till Tuesday, follows a three year probe of the largest truck stop firm in the country.
Not indicted was company president James A. Haslam, also the owner of the Cleveland Browns. Haslam, brother of Tennessee Gov. William Haslam, has repeatedly denied any knowledge of the scheme.
The probe became public on April 15, 2013 when FBI agents raided Pilot's Knoxville headquarters.
Those indicted were former President Mark Hazelwood, Vice President John Freeman, Vicki Borden, John Spiewak, Katy Bibbe, Heather Jones and Karen Mann.
Hazelwood was charged with conspiracy to commit mail and wire fraud and witness tampering. All were charged with mail  and wire fraud. Hazelwood was arraigned today in U.S. District Court in Knoxville, TN. and entered a not guilty plea.
The remaining defendants were expected to appear and enter not guilty pleas later in the day.
In an affidavit filed in 2013 in U.S. District Court in Knoxville, an FBI agent provided a detailed description of the rebate fraud scheme, including secretly taped sales meetings in which Freeman and Hazelwood played prominent roles.
The affidavit, including transcripts of the sales meetings, was filed just days after the April 15 raid.
Ten other former Pilot employees have been charged and entered guilty pleas to similar charges and they await sentencing.
The rebate charges have already proven costly to Pilot. The company paid $84 million to settle a class action filed in Arkansas and $92 million to settle with the federal government.
Civil suits against the chain are still pending in Alabama and Ohio.
Pilot issued a statement stating they were "disappointed and saddened by today's events," but added that policies had been put in place to ensure it won't be repeated.
"The company has cooperated with the investigation since it's beginning and will continue to do do," the company said in its statement.

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