A total of 10 former employees of Pilot Flying J have now pleaded guilty to their roles in an elaborate fuel rebate scam that defrauded its customers out of potentially millions of dollars.
On Monday, Jan. 27, three ex-Pilot employees pleaded guilty in U.S. District Court for the Eastern District in Knoxville, Tenn.
Brian Mosher pleaded guilty to conspiracy to commit mail and wire fraud after admitting that he participated in a scam to fraudulently reduce the amount of rebate checks his customers were supposed to receive each month.
According to court documents, Mosher, who worked remotely from his home in Bettendorf, Iowa, would identify the amounts his customers were supposed to receive each month. Then he would revise the emailed spreadsheet, inserting manually lower rebate amounts that his targeted list of customers were to receive.
Court documents claim the lowered rebate amounts created greater sales commission for Mosher and more profit for Pilot.
Mosher also taught other senior management and directors in Pilot’s direct sales department his “manual rebate practices” in break-out sessions at a mandatory sales-training meeting at Pilot’s headquarters in Knoxville, Tenn., court documents state.
Mosher faces up to 20 years in prison and a fine of up to $250,000.
Christopher Andrews, former regional sales manager at Pilot, pleaded guilty to one count of conspiracy to commit an offense against the United States. Andrews worked for the company for at least three years, starting in 2010.
Court documents allege Andrews agreed and conspired with other Pilot employees to “deceptively withhold discounts from some Pilot customers through the deceptive reduction of monthly rebate amounts” from about January 2011 through about April 2013.
As with Mosher, Andrews, who worked remotely from his home in Texas, would receive a spreadsheet with the amounts of rebates his trucking company customers were owed. Then he would “withhold rebate amounts,” discounting them, from his “less sophisticated” Pilot customers.
According to court documents, a trucking company, Honey Transport, questioned the rebate amount it received, which Andrews and Pilot blamed on an “inadvertent change in Pilot’s system,” but the company did not receive the amount of the discrepancy owed.
According to Andrews’ plea agreement, he admitted that he “learned from experienced and more senior Pilot direct sales personnel that deceptive manual rebate reductions were part of the Pilot direct sales culture and that he was expected to make such reductions.”
Andrews faces up to five years in prison and a fine of up to $250,000.
Lexie Holden, who worked as a regional account represent at Pilot’s headquarters in Knoxville, pleaded guilty to one count of conspiracy to commit an offense against the United States.
According to court documents, Holden prepared and emailed the spreadsheets to Mosher, among others, with the rebate amounts the customers were owed so that he and others could then manually reduce the rebate amounts that were then sent out to certain Pilot customers.
She faces up to five years in prison and a fine of up to $250,000.
In November 2013, just seven months after federal investigators publicly announced a criminal investigation into Pilot’s fuel rebate program, a federal judge approved a nearly $85 million class action settlement. However, 16 lawsuits filed by trucking companies opting out of the class action settlement remain in state and federal courts around the country.
Pilot CEO James “Jimmy” Haslam III, also owner of the Cleveland Browns, has denied any involvement in the alleged fuel rebate scam.
See related stories:
More Pilot employees plead guilty to roles in alleged rebate scam
Judge approves nearly $85 million in Pilot Flying J class action settlement
New details emerge in Pilot Flying J criminal investigation
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