3 Former Pilot Flying J Execs Sentenced in Fuel Rebate Fraud

Three more former Pilot Flying J executives will spend time behind bars over their roles in in a fraud scheme that cheated trucking companies out of millions of dollars of promised fuel rebates.

"Our culture at the very top was to be hyper-competitive," former executive John "Stick" Freeman told the federal judge, according to a report on Knoxnews.com, admitting that he let it go too far.

Freeman and Brian Mosher were sentenced to two-and-a-half years in prison, while Vicki Borden received a two-year sentence. Freeman and Mosher must each pay a $100,000 fine, and Borden a $75,000 fine. The judge said he was lenient because the three pleaded guilty early in the case and handed over evidence to prosecutors.

Former Pilot president Mark Hazelwood will spend 12-and-a-half years in prison for overseeing the scheme. A federal jury convicted Hazelwood in February of wire fraud, witness tampering and conspiracy to commit wire fraud.

Mosher, a former regional sales director, testified at Hazelwood’s trial, and got the lightest sentence in exchange.

As Knoxnews reports:

Freeman, Pilot's former vice president of sales, began defrauding trucking companies as early as 2007. He bragged shamelessly about the fraud to bosses, employees and trainees, court records show - including at meetings recorded by an undercover FBI informant.

The fraud case dates back to 2012, when the FBI discovered that Pilot Flying J sales employees were operating a fuel-rebate scam that victimized trucking companies. The trucking companies were promised certain amounts back in rebates, but sales staff would reduce the amount at a later date to increase profits. Because of the complexities of the fuel buying market, most did not realize they were being shorted the promised rebates.

The FBI found that over the course of several years, Pilot Flying J defrauded as many as 5,500 customers of more than $56 million in owed rebates that were not paid.

Nineteen executives and staffers of the truck stop giant have either admitted or been convicted by a jury of participating in the fraud scheme. Fourteen pleaded guilty, three were convicted, and two were granted immunity.

Pilot Flying J’s board of directors has admitted criminal responsibility and paid a settlement for the fraud. Pilot CEO Jimmy Haslam has denied knowledge of the scheme and has never been charged.