Since ceasing operations Dec. 21 with no prior warning, Arrow has been hit by financial and legal troubles, including two class action lawsuits filed by employees who seek damages, and three lawsuits filed against CEO Doug Pielsticker by banks. Arrow was also sued by its main creditor, Utah-based Transportation Alliance Bank, alleging fraud and racketeering.
The trucking company is now being pursued by federal investigations, as federal officials showed up at the company's Tulsa, Okla., offices last week, according to Tulsa World.
The Transportation Alliance suit also alleges that during 2009, company executives received "extremely excessive and over-market salaries relative to their job duties." The Utah bank said in the suit it became concerned last July about possible irregularities in documents. Things finally reached a head Dec. 21, when TAB shut off the company's credit line and canceled its fuel cards.
It has also come to light that Arrow officials were receiving payouts from two insurance companies owned by Arrow, including Altura Insurance Group, the World says.
According to the publication, several Arrow executives, including Doug Pielsticker, Chairwoman Carol Pielsticker, and former Executive Vice President Joseph Mowry, were shareholders in Altura and received hundreds of thousands of dollars from the investment. The firm was owned by Sherril Roberts, the wife of Mowry.
Arrow created Altura in September 2005 to handle the company's casualty, auto and accident insurance policies. In 2006, Roberts bought out the other shareholders, the World reports. Doug and Carol Pielsticker sold their shares for about $500,000 and $250,000, respectively.
Since the paybacks were to be spread out over a four-year period, the officials have not received their full investment because of the collapse, the World says.