Pilot Flying J CEO Talks to Trucking About Fraud Allegations
May 16, 2013
Haslam says business at Pilot and Flying J is down about 3% since allegations of fraud surfaced about a month ago. (Photo by Robert F. W. Whitlock via Wikimedia Commons)
Embattled Pilot Flying J CEO and Cleveland Browns owner Jimmy Haslam on Thursday morning took questions from trucking for the first time since allegations of fraud surfaced a month ago, and asked fleets to work with the truckstop chain to resolve any problems rather than filing suit.
Haslam was speaking to trucking executives at the Scopelitis Transportation Seminar in Indianapolis, hosted by the transportation law firm of Scopelitis Garvin Light Hanson & Feary. He said he was unaware of the company cheating trucking industry customers out of fuel rebates to boost company profits as the FBI, IRS and several trucking companies have alleged.
While denying any wrongdoing, Haslem told the audience it has contacted about 5% of its fleets clients in the matter, according to published reports.
“We’ve had to make adjustments regarding the accounts of 250 of our clients, to the detriment of Pilot Flying J and to the benefit of our clients," he said. Haslam noted these actions did not mean admission that anyone with the company did anything wrong. He described “any willful wrongdoing" as intolerable, and when asked if he knew about the alleged scheme, he said, “absolutely not.”
On April 15, agents from the FBI and the IRS executed several search warrants as part of an investigation. The raid was followed by the release of a more than 100-page affidavit outlining its justification for the warrants. The affidavit contains information indicating that Haslam and Pilot Flying J President Mark Hazelwood knew about shortchanging customers and discussed it at several meetings.
Haslam said the investigation has had an effect on Pilot Flying J business, noting it’s down about 3%. Last year the company had revenue of about $29 billion.
No indictments have been made in the case, but about half a dozen lawsuits have been filed against Pilot Flying J since the raid. Haslam used the appearance as a opportunity to call on fleets not to sue the company, saying if they deal directly with Pilot Flying J they will get full repayment of any money owed to them and quickly.
Questions to Haslam at the event were submitted in advance rather than directly from the audience.
"I apologize for the actions of our people,” he said. “And I want to look everyone in the eye and say we'll do everything we can to make things right."