Drivers

FBI, IRS Raid Pilot Flying J Headquarters

April 15, 2013

By Evan Lockridge

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Pilot Flying J says its locations are all still operating despite an FBI/IRS raid on its Tennessee headquarters.
Pilot Flying J says its locations are all still operating despite an FBI/IRS raid on its Tennessee headquarters.

Dozens of agents from the IRS and FBI conducted a Monday raid on the Knoxville, Tenn., headquarters of the nation’s largest truckstop and travel plaza operator and one of the nation’s largest private companies, Pilot Flying J.

An FBI agent quoted by the Associated Press said the move is part of an “ongoing investigation” but would not give more details.

Soon after the raid, described as “orderly but swift” by an employee interviewed by the Knoxville News Sentinel, authorities checked the identities of employees and separated out those key to day-to-day operations from others. All reportedly were told to turn off their computers and other electronic devices, including cell phones. Agents also told employees to leave their company laptop computers and escorted some out of the building; the rest in some departments were told to stay.

The AP reported agents were expected to remain in the building well into Monday evening, focusing on the company’s accounting, customer service and information technology departments.

In a statement, the truckstop chain’s spokesperson, Lauren Christ, said, "As of the afternoon of April 15, FBI officials have sequestered the Pilot Flying J headquarters on Lonas Drive in Knoxville. At this time, we do not know the nature of the situation. Pilot Flying J is cooperating fully with the authorities. Pilot Food Marts, Pilot Travel Centers and Flying J Travel Plazas remain open and continue to serve the public. Pilot Flying J is confident that the matter will be resolved fully."

Pilot Flying J is led by CEO Jimmy Haslam, who recently returned to the company after stepping down last year to purchase the Cleveland Browns pro football team. In the interim, former PepsiCo executive John Compton headed up Pilot Fling J until Haslam’s return in February, with Compton reportedly becoming a consultant.

Tennessee Gov. Bill Haslam is said to have no position with the company but still has unknown holdings in it, reportedly in a blind trust since becoming the state’s leader.

About three years ago in running for the position, Bill Haslam refused to reveal how much money he earned from Pilot Flying J, claiming it would lead to revealing personal information about family members not running for office. Bill Haslam is the son of founder Jim Haslem. The younger Haslem headed up what was then Pilot Travel Centers until 2003, before he was elected Knoxville’s mayor.

In 2010, Pilot closed a deal with Flying J travel plaza for $1.8 billion, putting together an empire with more than 600 truckstops in North America. The Tennessean newspaper reports the Haslams sold a 47.5% stake in the company in 2008 to CVC Capital Partners, a private equity firm based in Luxembourg, but the family retained majority ownership and control of the company.

It is now the sixth largest private company in the United States, according to Forbes magazine, with annual revenue of $29.2 billion and 25,000 employees.

A spokesman for the governor said Haslam was “aware of the situation in Knoxville today” but declined to comment further, referring reporters questions to Pilot Flying J.

An NFL spokesman said the league was aware of the investigation but had no other information, nor would it comment. The Cleveland Brown football team also withheld any comment.

This is not the first time Pilot Flying J has been placed under a microscope by investigators. A few years ago price gouging suits were filed against it in Tennessee, Kentucky and Georgia.

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