More Pilot employees plead guilty to roles in alleged rebate scam

By Clarissa Kell-Holland, Land Line staff writer | Tuesday, July 30, 2013

Two more members of Pilot Flying J’s diesel fuel sales staff have pleaded guilty to criminal charges. They admitted they participated in an alleged fuel rebate scheme to defraud trucking companies out of potentially millions of dollars they were owed through the company’s fuel discount and rebate program.

This brings the number of employees who have pleaded guilty to federal charges up to seven since the Federal Bureau of Investigation and the Internal Revenue Service raided Pilot’s headquarters in mid-April.

On Monday, July 29, Janet Welch, who worked as a senior regional account representative at Pilot, pleaded guilty in federal court in Knoxville, Tenn, to a charge of conspiracy to commit mail fraud.

According to Welch’s plea agreement, she prepared and emailed “monthly spreadsheets for approval to other Pilot direct sales personnel that contained the actual rebate amount due to all of the listed Pilot customers and a deceptively reduced rebate amount for some of the listed Pilot customers.”

In court documents, one trucking company “adversely affected” by Welch’s participation in mailing the reduced rebate checks was Dana Transport Inc., of Avenel, N.J. The trucking company has approximately 279 truck drivers and 309 power units, according to the Federal Motor Carrier Safety Administration’s SAFER website.

Also mentioned in Welch’s plea agreement was her participation in a Pilot training session in November 2012, where Pilot direct sales personnel were taught in a breakout session how to “defraud, without detection, some of Pilot’s customers who chose to receive their discount in the form of a monthly rebate.”

The affidavit, which was unsealed a few days after the FBI/IRS raid, included transcribed conversations by employees at that meeting, including Welch. The conversations were secretly taped by a confidential informant who worked at Pilot as part of an FBI investigation.

Also pleading guilty to a charge of conspiracy to commit mail fraud was Michael Scott Fenwick, a former regional sales manager at Pilot’s direct sales division.

According to Fenwick’s plea agreement, he admitted to deceptively withholding monthly rebate amounts from certain Pilot customers from 2009 through April 2013. According to court documents, he directed Ashley Judd, a former regional account representative who has also pleaded guilty, over the phone to fraudulently reduce some of his customers’ rebate amounts.

Fenwick stated that if caught by a customer, he would just blame the fraudulent reduction on “Pilot inside sales staff or a computer software error,” according to court documents.

See related stories:
Three more Pilot employees plead guilty in alleged fuel rebate scheme
Two Pilot employees plead guilty in alleged fuel rebate scheme
FBI, IRS investigation focuses on Pilot Flying J customer 'rebate' program

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