A joint motion has been filed in federal court seeking a judge’s approval to delay scheduling a sentencing date for seven Pilot Flying J employees who have pleaded guilty to their roles in an alleged fuel rebate scheme.
According to court documents filed in U.S. District Court for the Eastern District in Knoxville, Tenn., Assistant U.S. Attorney Trey Hamilton III and Edward M. Yarbrough, attorney for Arnold Ralenkotter, have filed a joint motion to reset the status conference originally scheduled for Sept. 30 until Feb. 3, 2014.
In July, U.S. District Court Judge Amul R. Thapar had originally ordered the status conferences for the seven Pilot employees to be combined and scheduled for Sept. 30. The Pilot employees who have pleaded guilty to criminal charges include Ashley Judd, a regional account executive; James S. Stinnett, senior regional sales manager; Holly Radford, an accounts representative; Kevin Clark, regional sales manager; Michael Scott Fenwick, regional sales manager; Janet Welch, a senior regional account representative; and Ralenkotter, director of sales for the Northeast region.
Ralenkotter pleaded guilty to conspiracy to commit mail fraud and wire fraud in late May. This was after a criminal investigation was launched by federal investigators, alleging that certain members of Pilot’s sales staff entered into rebate or discount programs with trucking companies for purchasing a certain volume of fuel each month, but then manually reduced the amounts the companies were owed.
The alleged scam was known to Pilot insiders as “jacking the discount” or “managing the discount.” More than two dozen lawsuits have been filed in state and federal court since the criminal investigation was announced in April.
According to the 120-page FBI affidavit unsealed in mid-April, Ralenkotter explained in a recorded conversation with an FBI informant about the discount system he used to manually reduce rebate checks and reminded sales staff to be “careful” not to raise customers’ suspicion by having months where customers received a large rebate check, then another month where they received a small rebate check.
“If the guy’s been getting $100,000, $100,000, $100,000, now you send him $180,000, and then the next month you send him $75,000 …”
He is interrupted by John Freeman, who was the vice president of sales for Pilot, who added, “He thinks you’re (expletive) ’em.”
Ralenkotter then stated, “He thinks you’re (expletive) ’em. So you might as well be (expletive) ’em.”
According to the joint motion filed on Monday, Sept. 16, “… neither party is requesting the court to schedule a sentencing date in this case at this time.”
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