| July 14
July 14 Pilot Flying J, the large U.S. operator
of truck stops, agreed to pay a $92 million fine to resolve its
criminal liability for a scheme in which employees fraudulently
withheld diesel fuel price rebates from customers, the U.S.
Department of Justice said on Monday.
The Knoxville, Tennessee-based company accepted legal
responsibility for criminal conduct of its employees and has
made more than $56 million of restitution and $12 million of
additional payments to customers, the Justice Department said.
Pilot Flying J, one of the largest privately held U.S.
companies, also agreed to improve its accounting and compliance
procedures and cooperate with the federal probe of current and
former employees, who remain subject to prosecution.
While the company will not be prosecuted, it would face a
criminal conspiracy charge if it materially breached its
obligations. If that occurred, it would not contest the
underlying allegations, the Justice Department said.
"The terms of this agreement, including the significant
monetary penalty and the very serious consequences if Pilot
fails to comply, demonstrate quite clearly that no corporation,
no matter how big, influential, or wealthy, is above the law,"
U.S. Attorney Bill Killian in Knoxville said in a statement.
Pilot Flying J's chief executive is Jimmy Haslam, who is
also majority owner of the Cleveland Browns football team.
"We, as a company, look forward to putting this whole
unfortunate episode behind us, continuing our efforts to rectify
the damage done, regaining our customers' trust and getting on
with our business," Haslam said in a statement. "We've been
committed from the beginning of this to doing the right thing,
and that remains our commitment."
Pilot Flying J has roughly 650 retail locations, and
according to the government sells about 6 billion gallons of
diesel fuel annually to trucking companies.
The company generally offers rebates based on volume and
other factors to encourage customers to buy its fuel rather than
buy from competitors.
But the Justice Department said employees, sometimes with
the encouragement of supervisors, withheld rebates to boost
Pilot Flying J's profit and their own sales commissions.
It said this was typically done by reducing monthly rebate
amounts, or lowering "off-invoice" discounts.
Since April 2013, when search warrants were executed at
Pilot Flying J's headquarters and other locations, 10 employees
have pleaded guilty to mail and wire fraud charges and agreed to
cooperate with investigators, the Justice Department said.
(Reporting by Jonathan Stempel in New York; Editing by Dan