KNOXVILLE, Tenn. -- Three more Pilot Flying J Inc. employees pleaded guilty Tuesday to mail fraud, federal charges related to a conspiracy to cheat trucking companies out of diesel fuel rebates, reported the Associated Press. They are Kevin Clark, a regional sales manager in Kansas City, Mo.; Holly Radford, a regional account representative at the company's Knoxville, Tenn., headquarters; and Jay Stinnett, in sales, said the report.
Federal agents raided the privately held company's Knoxville headquarters on April 15.
In late May, regional sales director Arnold "Arnie" Ralenkotter pleaded guilty to one count of conspiracy to commit mail fraud in U.S. District Court in Knoxville. Regional accounts representative Ashley Smith Judd also pleaded guilty to conspiracy.
"We are disappointed in the actions of these employees towards our customers," according to a message from Jimmy Haslam, Pilot Flying J CEO, posted on the company's website. "We assure our customers that our five-step plan to correct any wrongdoing and to make certain these actions do not happen again is ongoing, and that our customers' confidence in the vast majority of our 23,000 team members nationwide remains well-placed."
The plan included auditing of customer contracts, putting certain employees on administrative leave, converting rebate calculation to an electronic process, creating the position of chief compliance officer and hiring an independent special investigator.
Court records cited by the news agency show that Clark "knowingly and voluntarily joined and participated in the conspiracy" with others at Pilot Flying J, the country's largest diesel retailer, to short-change trucking companies between 2009 and this spring in order to increase Pilot profits and boost sales commissions.
As part of the plea agreement, prosecutors said they will only hold Clark responsible for rebate reductions he personally approved, rather than all of the alleged fraud committed as part of the conspiracy. Clark has agreed to cooperate with the investigation and testify on behalf of the prosecution.
Secret recordings made as part of the investigation show that members of the Pilot sales team derided some clients as unsophisticated, lazy and undeserving of rebates they had negotiated when signing a deal to buy fuel from Pilot. An FBI affidavit indicates the company unfairly withheld millions of dollars.
Truckers and trucking companies have filed nearly a dozen lawsuits so far stemming from the investigation into an scheme.
Knoxville, Tenn.-based Pilot Flying J has more than 650 retail locations and is the largest operator of travel centers and travel plazas in North America. Its network provides customers with access to more than 60,000 parking spaces for trucks, more than 4,400 showers and more than 4,000 diesel lanes. Pilot Logistics Services is one of the largest independent energy logistics companies in North America, selling and distributing more than 1.3 billion gallons of refined petroleum products and serving more than 15,000 customers. Together, Pilot Flying J and Pilot Logistics Services generate sales of approximately nine billion gallons of petroleum annually.
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