In 2009, the same year Arrow Trucking would collapse and leave hundreds of the company’s drivers stranded on the roads just before Christmas, former Arrow Trucking CEO Doug Pielsticker received hundreds of thousands of dollars from the company accounts to pay for personal expenses, including his wedding and payments on luxury cars, according to a federal indictment filed in U.S. District Court.
In addition to unspecified cash infusions totaling hundreds of thousands of dollars between Nov. 4, 2009, and Dec. 8, 2009, the indictment states that Pielsticker received nearly $283,000, beginning in January of that year. Outlays included a $36,380 payout to Porsche Payment Center by Oklahoma-based Arrow Trucking on behalf of Pielsticker, as well as two separate payments of $10,000 to his ex-wife.
Altogether, the indictment lists 23 counts of fraud and conspiracy, including a scheme federal prosecutors say bilked a Utah bank out of $15 million, and charges of tax fraud. The bank fraud charges stem from a conspiracy allegation that Pielsticker and others at Arrow Trucking misreported company assets to Transportation Alliance Bank of Utah, in an effort to secure loans from the company.
Another former Arrow Trucking Co. executive, Jonathan Leland Moore, struck a plea deal with prosecutors that fingers Pielsticker as a fraud conspirator. In his plea agreement, Moore states that he and co-conspirators attempted to hide the transmission of false information to the bank by various means, including by directing individuals to pretend to be shippers in telephone conversations with bank representatives.
In addition to the bank fraud charges, the indictment alleges that Arrow trucking withheld $5 million in employee payroll taxes without accounting for, or paying over, that money to the IRS, as well as Pielsticker’s own individual tax returns for the years 2007, 2008, and 2009.
Moore’s plea agreement states that the loss to the IRS totaled more than $9 million, bringing the total amount of losses in the alleged conspiracy to $24 million. Moore’s plea agreement is contingent on his cooperation in other cases against co-conspirators.
Arrow Trucking Co. closed its doors abruptly just before Christmas in 2009, stranding hundreds of drivers without paychecks, fuel cards or the means to get home to their families. Pielsticker filed for bankruptcy protection from creditors soon after the shutdown.
Doug Pielsticker, now 46, was named CEO of Tulsa-based Arrow Trucking Co. after Jim Pielsticker, his father and a prominent Tulsa businessman, was killed in a plane crash in 2001.
Much has been alleged and written about how the younger Pielsticker ran the company, how he spent large sums on cars, an airplane and vacation property and left his drivers hanging at the end.
Former company drivers filed a lawsuit in 2011 seeking restitution for what they were owed. Deliberations revealed that Pielsticker and his mother Carol Pielsticker Bump had been living high on the hog and spending lavishly even as their company was going down the tubes.
The trustee in the lawsuit, Patrick Malloy, estimated that Arrow Trucking Co. had $8.5 million in assets but owed $99 million to creditors. That suit alleged that Pielsticker fraudulently transferred $8.4 million to himself “disguised as salary” while Bump received $4.4 million.
Pielsticker and Bump agreed to settle the civil suit with the trustee who distributed more than $2 million to 550 former company drivers.
In November 2010, prior to the civil suit being filed, Doug Pielsticker was arrested on a bad-check warrant during a traffic stop. His attorney managed to get a felony charge dropped after Pielsticker agreed to send $1,200 to former Arrow Trucking Co. driver Denny Carter who had pursued charges against his former boss.
The complete indictment can be viewed here.
Senior Editor David Tanner contributed to this report.
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