Pilot Flying J, a truck stop chain, has agreed to pay $92 million in fines for a scheme to cheat truck drivers out of agreed-upon diesel fuel rebates. In an agreement with the U.S. Attorney’s Office for the Eastern District of Tennessee, Pilot Travel Centers LLC, which does business as “Pilot Flying J,” took responsibility for the scheme run by its employees. The scheme cost the company’s customers more than $56 million. This agreement comes after 10 Pilot Flying J employees pleaded guilty to involvement in the scheme. Incidentally, the company is controlled by Cleveland Browns owner Jimmy Haslam. The details of the enforcement agreement entered were released on July 14.
Pilot Flying J, one of the largest trucker diesel suppliers in the U.S., offered rebates and discount programs in order to encourage loyalty among its customers. But these programs were complex. The discounts offered by the company varied among its numerous truck stops, making it very difficult for customers to know whether they were getting their agreed-upon discounts. The U.S. Attorney’s office said the company, in some instances, taught its sales staff how to reduce the rebates in order to make some accounts more profitable.
It appears that both Haslam and Pilot President Mark Hazelwood knew that sales staff were withholding rebates from some of the company’s less-sophisticated customers. Knoxville-based Pilot compensated some of the affected customers in the wake of the scandal. In November, a federal judge approved Pilot’s $85 million settlement with a class of 4,500 customers in a lawsuit filed in an Arkansas federal court over the fuel rebates. Several Plaintiffs opted out of the settlement. In April, the U.S. Judicial Panel on Multidistrict Litigation consolidated seven suits and assigned the case to the U.S. District Court for the Eastern District of Kentucky.
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