The Case Against Pilot: Behind the Accusations of Fraud at Pilot Flying J

It reads like a David Mamet play.

The affidavit by FBI Special Agent Robert H. Root that provided enough evidence for a judge to order search warrants for last week’s raid on Pilot Flying J headquarters in Knoxville, along with an off-site computer storage facility and three home offices in Nashville, Kentucky, and Iowa, is 120 pages long and filled with multiple excerpts of recorded conversations.

It’s those conversations that provide the most damning evidence against Pilot, even as they sound like a re-imagined version of Glengarry Glen Ross, peppered with dirty language and sales meetings at high-end locales. And it’s those conversations that reveal the ins and outs of a rebate scheme that allegedly defrauded dozens, maybe hundreds, of trucking companies to the likely tune of millions of dollars over a number of years.

The affidavit isn’t an indictment, of course. No one at Pilot has been arrested or charged with any wrongdoing, and it could be years before any charges are brought. Pilot CEO Jimmy Haslam said on Friday that “we feel confident that this company is run the right way and will be continued to run the right way” and denied that he personally had done anything wrong.

“It still appears to us that this investigation is focused on a very narrow band of a very large company,” Haslam stated.

Indeed, the affidavit only names around 40 employees, and it doesn’t necessarily implicate all of those employees as being involved in the scheme. And Haslam’s right—40 employees out of 23,000 or so is a very small number of potential wrongdoers.

But what he didn’t say is that those names include some of the most powerful people at Pilot Flying J, including himself. The affidavit alleges that Haslam; the president of Pilot, Mark Hazelwood; the CFO, Mitch Steenrod; the Vice President of Sales, John Freeman; the Vice President of National Sales, Scott Wombold; the Director of Sales for National Accounts, Brian Mosher, and the three regional directors of sales all possibly knew about and/or participated in the rebate fraud for years. These aren’t low-level employees skimming off the till.

Shortly after the NFL approved Haslam’s ownership of the Cleveland Browns last October, he addressed the media in a Chicago hotel. Haslam said his style of leadership in the NFL would be similar to his role as a CEO.

“I had five people that reported to me at Pilot Flying J. They’re all smarter than I am and they’re all better at their role than I am, and we let them do their jobs. On the other hand, we question them, we push them, we challenge them, we hold them accountable,” he said.

If what’s revealed in the affidavit is proven to be true, the primary accountability in the Pilot sales department was to profit, and the brains Haslam praises were used as the justification for defrauding “less sophisticated” customers.

The government’s affidavit details a culture of arrogance and recklessness seemingly encouraged by the corporation. Whether or not Haslam is eventually implicated in the fraud, Pilot likely won’t be coming out of this scandal unscathed.

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The FBI’s investigation goes back two years, to May 4, 2011, when the agency was approached by a current Pilot employee with knowledge of what the affidavit refers to as “discount fraud” and “rebate fraud.” The document notes that Pilot employees referred to the former as “managing the discount,” and “jacking the discount,” and the latter as “manual rebates,” “manuel,” “manwell,” “manuals,” “manny,” “manually calculating the rebate,” “cutting the rebate,” “adjusting,” and “trimming,” “cost-plussing,” “screwing,” and “f--king.” (Fair warning: The excerpts of conversation that we will quote throughout this story are chock-full of language much more colorful than “f--king.”)

This employee, referred to in the document as Confidential Human Source 1, or CHS-1, told the FBI that another employee, CHS-2, had told him/her that a number of employees were intentionally defrauding customers. CHS-1 then secretly recorded this employee in conversation from June 2011 until sometime in 2012. Over the course of these conversations, CHS-2 revealed that Freeman and Mosher “had been fraudulently withholding a portion of the Rebate Amount due to their Customers who received monthly rebate checks.” These same conversations also revealed that a former Pilot employee, Cathy Giesick, had known about the fraud while at the company; she agreed to help with the investigation.

The FBI and the criminal investigation arm of the IRS approached CHS-2 on Oct. 4 of last year. He also agreed to become an informant and to covertly record conversations in exchange for immunity from prosecution. His recordings provide the brunt of the most derogatory information in the affidavit.

(We should note here that the affidavit inadvertently unveils CHS-2. The document describes CHS-2 as “a current Regional Director of Sales” and later refers to him getting packages delivered at his “remote office location in Bedford, Texas”; it describes another employee the same way. We asked U.S. Attorney Bill Killian to confirm the identification; he declined to comment. Attempts to reach the employee in question were unsuccessful, so we are refraining from using his name.)

From October through April, CHS-2 recorded conversations with other employees, sales meetings, training sessions, and more. The FBI notes that it has many more recorded conversations than the ones excerpted in the affidavit, and that the document doesn’t necessarily represent the bulk of its investigation, so it’s not clear how much evidence the agency has on Pilot. What is clear, however, is that CHS-2’s stature at the company—according to the employee’s LinkedIn profile, he’s been with Pilot since February of 1995—meant that everyone seemingly involved in the rebate fraud was comfortable talking to him. What’s also clear is that the things people told him don’t look good for anyone involved.

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Here’s how the rebate fraud allegedly worked.

Pilot Flying J is the largest operator of truck stops in the country, and it has accounts with about 3,300 trucking companies. Those companies can opt to get discounted fuel prices at the pump or rebate checks mailed to them, all based on the amount of gas they buy. Think about credit cards that give a certain percentage cash back for every thousand dollars you spend—it works kind of like that. Except unlike your Discover card or your Capital One Visa, the discount/rebate amount varies from company to company and varies with the cost of fuel.

According to information from CHS-2 and from conversations in the affidavit, certain Pilot sales employees wouldn’t give certain accounts their full discounts month after month. Instead of letting the rebates be processed automatically, some members of the sales staff would manually enter in a smaller number on the check to be issued to the client. The company would keep the extra money, and the sales reps’ commissions would increase.

The affidavit alleges the fraud has been happening at least since 2008, perhaps several years longer. And the amounts of money being skimmed weren’t insignificant. On Dec. 17, CHS-2 told the FBI that Regional Sales Manager Scott Fenwick had told him he was keeping a total of $70,000 to $90,000 in lost rebates each month.

The sales team allegedly targeted customers deemed “unsophisticated.” At a Nov. 19 training session for sales reps in Knoxville, the following discussion occurred:

Note: All ellipses in transcripted conversations are per the FBI, except those designated as [...], which signal our edits of the conversation. All transcriptions are otherwise verbatim.

SCHIMMEL: Let me ask a question. Even though, do we have an idea of what percentage of people out there truly know, have an understanding of discounts? I mean ...

MOSHER: I would tell you it’s, I’m gonna say way less than 50%. I’m thinking it’s 25% or less, that really, really know on a day-in-day-out basis. Now, again, that depends, right? Because if you’re sending that customer a daily price fetch, he doesn’t have to know, all he has to do is save his e-mails, okay? Because he can go back and recalculate this stuff. (Laughter.) But the guy that doesn’t—huh?

WELCH: Some of ‘em. (Laughter.)

MOSHER: Some of ‘em, some of ‘em don’t know what a spreadsheet is. I’m not kiddin’. So, again, my point is this: Know your customer. Know what you’re sending him, know what his preferences are, know how sophisticated he is, okay? If the guy’s sophisticated and he truly has gone out and gotten deals from the other competitors and he’s gettin’ daily prices from us, don’t jack with his discounts, ‘cause he’s gonna know, okay? But the guy that’s just sayin’ “Cost-plus, cost-plus, cost-plus, I need cost-plus.” “Why do you need cost-plus and what do you know about cost-plus? How’s cost-plus compare to retail-minus over the last three months?” “I don’t know, but Love’s is sayin’ it, so I need it.” Solution: Tell him we can do it. Tell him we can do it on a rebate.

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During a discussion between the informant, Freeman, and a regional sales manager, Chris Andrews on the night of Feb 6., Freeman put it more bluntly:

FREEMAN: […] But it, it creates the opportunities if you feel like you’re gettin’ f--ked. Because if you’re bein’ lied to you don’t—I’ve always said, you know, it’s fun as shit competing against your competitors, but when you’re competing against your competitors AND you’re competing against being lied to, you can f--kin’ win. Its liar’s poker. It’s game on. Let’s play. […] So if a guy, you put ‘em on cost-plus and you’re sendin’ ‘em a check and you’re sendin’ ‘em the reconciliation, you’re showin’ ‘em an 8-cent discount. Well, if our margins blow out and the next month you send ‘em a 38-cent discount, and then the next month the margins go back and you send ‘em an 18-cent discount, they’re pissed.

CHS-2: Right.

FREEMAN: It’s like you’re f--kin’ me. So what Chris has done is, as he’s set guys up on cost-plus and done the manual stuff, he’s managed it to the discount amount. “Oh my god, we’ve had great margins, your discount’s been 8 cents, but this month we’ve had a great margin, I’m sendin’ you an 11-cent discount.”

ANDREWS: Even on a direct-bill customer like the ladies today, put a cap in there. So when the margins blow out, just like you said, they don’t need to know that.

FREEMAN: They don’t have to know our margins. They don’t f--kin’ understand.

ANDREWS: That’s still a great discount.

CHS-2: Sure, sure. But what they don’t know doesn’t hurt ‘em.

FREEMAN: That’s exactly right. I mean, f--kin’? Give ‘em a f--kin’ 38-cent discount? There’s no way.

[…]

CHS-2: But, I see what you guys are saying now, maybe I’ve just been too honest the whole time. And not that we’re bein’ dishonest—

FREEMAN: Not a dishonest deal as much as it is just figuring out there’s a thousand ways for us to sell it—

CHS-2: Right.

FREEMAN: —a thousand ways for him to buy it, you gotta figure out how he wants to buy it and what strokes his cock.

CHS-2: Right.

FREEMAN: And then hit it as hard as you can hit it.

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Occasionally, customers would catch on to what was happening. At dinner on Oct. 23, the informant discussed these situations with Karen Crutchman, who works as his support staff in Knoxville.

CHS-2: I know when I was in Vegas, Brian was saying he got busted with some big one.

CRUTCHMAN: Yep.

CHS-2: What do they normally just ... what do they normally tell them?

CRUTCHMAN: They say, oh it’s the [unintelligible]. I’ve told them, like sorry, it was a computer glitch. I’ll fix it.

[…]

CHS-2: [Freeman] was cooking the books pretty good?

CRUTCHMAN: Oh yeah.

CHS-2: And why wasn’t Jimmy smart enough to figure that out?

CRUTCHMAN: Does he care?

CHS-2: What?

CRUTCHMAN: He just wants numbers.

CHS-2: But he knew Jim ... and John was monkeying with the rebates.

CRUTCHMAN: He don’t know anything about our business.

CHS-2: Well, he knew about Western, cause I remember sitting in sales meetings.

CRUTCHMAN: Western, because it got called out because of Knight. That’s the only reason. He didn’t know about the others.

As Crutchman states in the transcript, it would appear that Haslam knew of at least one situation of alleged rebate fraud: when Freeman got caught skimming rebates from Nashville-based Western Express and, as repayment, had to buy an airplane. In a Nov. 20 meeting, CHS-2 attended a sales meeting at Pilot headquarters with all diesel sales personnel. Also present were Haslam, Hazelwood, and Steenrod—even though this was during the time period in which Haslam had stepped away from the CEO position. The following conversation occurred:

HAZELWOOD: ... because what David Owens really tells them is its cost plus five. That’s what he tells them with no idea what cost plus five is. We’re going to go into the marketplace at four with a zero fee and we are going to give you credit. You’re going to pay three times a week. That’s going to ...

Male Voice #1: —like Stick’s old deal with Western ...

HAZELWOOD: Yeah, [laughter] Well, we’re gonna, we’re gonna intro, going to introduce him to a guy by the name of Manuel.

Male Voice #2: No planes in this deal.

FREEMAN: Yeah, ah, some of us, rich and famous, we have our own, own planes.

HAZELWOOD: ... [continues presentation to assembled group]

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On Feb. 6, according to the transcripts, Freeman told the informant that he had discussed his rebate fraud with Haslam, who reportedly had no problem with it.

CHS-2: Well what if you can’t talk your way out of it? They figure out a way and they’ve got you nailed?

FREEMAN: You pay up.

CHS-2: Pay it?

FREEMAN: Yeah. Or you buy an airplane.

CHS-2: What does Mark and Jimmy say about shit like that? Do they even catch it or do they know?

FREEMAN: F--kin’ A. I mean, I called Jimmy and told him I got busted at Western Express.

CHS-2: What’d he say?

FREEMAN: Oh he knew it.

CHS-2: Oh did he?

FREEMAN: Absolutely. I mean, he knew all along that I was cost-plussin’ this guy. He knew it all along. Loved it. We were makin’ $450,000 a month on him—

CHS-2: Holy shit!

FREEMAN: —why wouldn’t he love it?

CHS-2: Yeah.

FREEMAN: Did it for five years, cost us a million bucks. I mean, we made $6 million on the guy, cost us a million bucks.

CHS-2: Great investment.

Freeman explained the whole story behind the airplane purchase at an Oct. 25 meeting of senior sales staff at his lake house in Rockwood. It seems to have become an inside joke at Pilot over the years.

FREEMAN: […] Anyway, that three months I basically cost them almost $1 million. I mean, I was playin’ with 4-1/2 million gallons and there was, you know, a 13-cent spread between the average and the actual during that huge downturn. And it was like $300,000 a month. And I sent the f--ker a $2 million check, but there was 3, I just kept the $300,000 part of that, and so, at the end of three months, you know, I owed ‘em. I owed ‘em a million bucks, wasn’t it? It was some number. But anyway, I’m like, oh f--k, you know. It crushed me and it hurt his feelings, but we got past all that. And I said, alright, I’m gonna get you a check. And he said, “Nah, I’ve got this airplane over here on the books for $7 million, I owe $1 million bucks on it, why don’t you just buy this airplane?” And I’m like, “What ...” So I bought the f--kin’ airplane.

MALE: He couldn’t fly to Knoxville, he—

FREEMAN: It was so broke; it was so broke the mother-f--ker wasn’t air-worthy, so we had to sell it in Nashville. So when I make my manual comments about havin’ to buy an airplane that was me, so ...

CHS-2: That’s funny.

FREEMAN: Yeah.

RALENKOTTER: But you do have to kinda almost, though, sometimes you have to be careful. Because if you set the expectation, if you have a blow out, most of ’em don’t know where the numbers come from—

FREEMAN: That’s right.

RALENKOTTER: If the guy’s been getting $100,000, $100,000, $100,000, now you send him $180,000, and then the next month you send him 75.

FREEMAN: He thinks you’re f--kin’ ‘em.

RALENKOTTER: He thinks you’re f--kin’ em. So you might as well be f--kin ‘em.

FREEMAN: See. F--k ‘em early and f--k ‘em often.

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On Dec. 7, there was an overnight event for Pilot employees at Blackberry Farm. Late in the evening, CHS-2 discussed Pilot’s accounts with the U.S. Postal Service with Ralenkotter and Mosher. Ralenkotter implied that he had monkeyed with the discounts for the USPS contractors but had stopped.

RALENKOTTER: Actually, we’re a legitimate cost plus 6. Cause you know why? I do not want to get thrown in jail.

MOSHER: That’s a pretty good point.

...

RALENKOTTER: Well, now I’m paying them fair. I’m paying them fair at cost plus six. I’m not going to f--k around with them because I’m not going to get thrown in jail.

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Then at a sales meeting in Orlando on Feb. 15, the Director of Sales for the East Region, Kevin Hanscomb, told the informant that Latinos make especially good targets for the rebate fraud.

HANSCOMB: They’re not stupid there is just ... uh ... there is a language barrier. So you can get away with a little bit more because they know that they are not going to understand everything that you say. So you can say cost minus, or cost plus 3, and it’s cost plus 5 and they’re not going to go oh well, he’s screwing us ... maybe I misunderstood. So there is some forgiveness there that probably isn’t at other parts of the world.

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Three days later, on Feb. 18, at the same sales meeting, Pilot employees discussed formalizing manual rebates into a two-tiered pricing system. Hazelwood seemed to be a fan of the plan.

FREEMAN: I tell you what would be great in our world internally, if we could have two-tier pricing. Have a set of racks for those companies that don’t close-watch, don’t optimize, and then another set of racks where you have to get in that optimizing close-watch game. There’s a whole bunch of f--kin’ guys that buy they’re getting cost-plus today that have no f--kin’ idea.

STINNETT: Why don’t we do that?

FREEMAN: Okay. Can’t we have two tiers? Like this’d be Tier-A, this is a Tier-A pricing

...

HAZELWOOD: What we’re really talkin’ ‘bout is two-tiered customers.

MALE VOICE: That’s right.

HAZELWOOD: Instead of two-tier pricing you’re talkin’—

RALENKOTTER: Yeah, and really, what John said there, again, we have the one-price file, we have that, but, we oughta have the ability to call out Customer Bs if we’re just gonna increase transport freight by a penny.

HAZELWOOD: Sure. Customer A, Customer B. Customer A looks at every orifice you have, Customer B doesn’t even know you have an orifice.

RALENKOTTER: Lori hits one button and blows a penny on everybody in Customer B.

MALE VOICE: Yeah, but you shouldn’t raise the rate on that guy [unintelligible].

FREEMAN: But you gotta know how your customer buys, right? (Unknown) buy, give him a cost-minus-32 and raise his freight rate to 40.

MALE VOICE: Right.

FREEMAN: That’s part of the game, I mean, but if you don’t know how they buy and what they understand, then you can’t take advantage of these things. And it’s our job to teach, manage, direct our regionals to understand all this stuff. And then Jay can get us set up to where we can have A and B buckets. Yeah, f--k ’em, just give ‘em what they want.

STINNETT: And what’d?

FREEMAN: You’re exactly right.

STINNETT: And you take advantage of our advantage.

RALENKOTTER: Put it to ‘em a way that—

MALE VOICE: Our advantage is their ignorance.

STINNETT: Yeah, AKA, we’re f--kin’ ’em. (Laughter.)

Later that same day:

HAZELWOOD: Manuel, now we got Aunt Bea.

MOSHER: Aunt Bea! (Laughter.)

HAZELWOOD: Who does that pricing, Aunt Bea does that one! Aunt Bea. (Laughter.)

HAZELWOOD: Aunt Bea.

HAZELWOOD: That’s what we’ll call this, Aunt Bea pricing.

MALE VOICE: Opie and Aunt Bea.

HAZELWOOD: We got Manuel, Manual does a hell of a job. Wonder what percent of our volume’s on Aunt Bea? What do ya think, 15%?

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On Feb. 22, CHS-2 recorded a phone call with Ralenkotter, during which, according to the affidavit, he said Freeman sent him an e-mail that said Jimmy Haslam “wanted us to sit down and make sure that the deals that are out there are deals that we have to be providing ... [and] want[ed] to be fair.” But the rest of the conversation was a discussion about the benefits of cost-plussing certain customers.

Then, over the course of the next few weeks, something apparently happened at Pilot.

On April 1 CHS-2 had a conversation with Crutchman about a computer problem, and talk turned to manual rebates. Crutchman told CHS-2 that Vickie Borden had been told by Steenrod and Pilot general counsel Kristen Seabrook to collect information from the regional account reps with the details of what rebate amounts had been paid as opposed to what should have been paid for at least the past year. She also said that Seabrook would be approving all rebate amounts going forward.

CRUTCHMAN: […] I knew it would end up coming back and biting somebody on the butt.

CHS-2: Uh, maybe not.

CRUTCHMAN: Me and you talked about it. You just can’t do stuff like this and it not come back on you.

CHS-2: We talked about that for years.

CRUTCHMAN: I know. And it may not be no big deal, maybe they are just doing an internal audit. But why all of the sudden?

CHS-2: That is weird.

CRUTCHMAN: Is that not weird? Talk about it, we were on, we were just like, holy cow, what the heck happened, what’s going on? If I’m not mistaken, when did we start, a lot of people doing those, back in 2008? Was it?

[…]

CHS-2: I wonder if Vicki’s nervous too.

CRUTCHMAN: Well, she wasn’t in a very good mood last week. But she told us not to worry, she said, “Don’t worry, there’s nothing to worry about, I just can’t tell you what’s going on.”

CHS-2: And usually she lets you guys know what’s going on.

CRUTCHMAN: Usually she does if, if she can. So evidently it’s probably something legally she can’t disclose any, I mean, it could just be, who knows, it could be a customer. We could be getting audited by the F, um, what is it, the, it could be anything. Or it could just be that Kristen wants to do this. From Chris says, cause when I told Chris about it, he called me back, I told him Thursday, I think it was Thursday, and evidently he called John or something, and he called me back and he was like, “I just want you to know not to worry, John said it was just internal stuff.”

[…]

CRUTCHMAN: Liability. From what she says is they want to know how much liability we’re looking at.

CHS-2: That’s what Vicki said?

CRUTCHMAN: Mmmhmm.

CHS-2: Mmm. What do you think it is?

CRUTCHMAN: Ahh, God, I, what, dollar wise?

CHS-2: Yeah.

CRUTCHMAN: Whew. I mean, high margin month, I mean, think about it, I mean, peoples cut it probably ten, twenty, thirty thousand dollars some of them. Some of them even more than that.

CHS-2: Yeah.

CRUTCHMAN: There’s gotta be, I’d say they, there’s probably a hundred manual rebates or more.

CHS-2: Mmmhmm.

CRUTCHMAN: And we’ve only got a few. We’ve only got a few. But I can’t, I, I mean, I can only imagine. Let me look here and see if I can, here’s BM manual rebate, one, two, three, four, five, six, seven, eight, nine, ten, eleven, twelve, thirteen, fourteen, fifteen, sixteen, seventeen, eighteen, nineteen, twenty, twenty-one, twenty-two, twenty- three, twenty-four, twenty-five, twenty-six, twenty-seven, twenty-eight. Just, Mosher’s old one, there’s twenty-eight.

CHS-2: What do you mean Mosher’s old ones?

CRUTCHMAN: I guess his regionals that he had, the manual rebates. Oh, dear Lord. Jacqui Pearl’s got (counting), fifty, fifty-one.

CHS-2: Jacqui’s got fifty-one?

CRUTCHMAN: Yeah. About fifty, mmhmm.

From this conversation, it seems like one of the sales people possibly implicated in the rebate fraud scheme is Jacqui Pearl, the daughter of former Vols basketball coach Bruce Pearl. According to her LinkedIn profile, Pearl has been a regional account manager in Chicago since last October and first started working for Pilot in May 2011, a year after graduating from the University of Tennessee. This same conversation lists a number of other sales employees with possible multiple fraudulent accounts besides Pearl, Andrews, and Mosher.

The next day, April 2, Freeman called CHS-2 and said the plans for the two-tier pricing model that Hazelwood had enthusiastically endorsed were now shelved. On April 9, Crutchman told CHS-2 that Seabrook wanted in her office by Friday, April 12, “all information necessary for Seabrook to review, calculate and approve Rebate Amounts to Customers that are scheduled to go out the week of April 15,” including “any document that states what Rebate Amount a Customer should have been paid by Pilot compared with what Pilot actually paid the Customer; any pricing information that was sent to a Customer, and any document that evidences an agreed upon diesel discount price for a Customer.”

The feds requested the search warrant on April 11 and went in on the 15th.

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Since the raid last week, Haslam has held three press conferences, although he only took questions at the first one, before the affidavit was unsealed. He said last Friday he would remain CEO. “Why would I [step down]? I haven’t done anything wrong,” Haslam told a room full of reporters.

On Monday he announced further measures to protect the company’s reputation. Haslam said Pilot would be conducting a thorough internal audit and also hiring a chief compliance officer within the next month. He said the manual rebate process would be eliminated by June 30 at the latest and all customers will be placed on electronic direct billing. And he said that “several members” of the diesel sales team implicated in the affidavit had been placed on “administrative leave.” Which members, how many members, whether they’re still getting paid—Haslam (and, later, his PR staff) declined to elaborate.

Finally, Haslam announced that Pilot’s board of directors has hired an independent special investigator, a person with prior experience in the Department of Justice, to come in and conduct his own inquiry. Since Pilot is a privately held company, it does not have to make its board members’ names public, but as of 2010 the board included both Jimmy and Big Jim Haslam, Sandy Beall of Ruby Tuesday, Fred Smith of FedEx, former Walmart president Lee Scott, and Byron Trott, Warren Buffet’s banker, among others.

Whether or not Haslam and other top executives are eventually charged with a crime, the fallout for Pilot may last years, and political insiders are worried the scandal could rub off on Gov. Bill Haslam. (He hasn’t worked at Pilot in over a decade but still owns part of the company.) One Georgia trucking company, Atlantic Coast Carriers, has already filed a civil suit, seeking damages under RICO and breach of contract. Similar suits are likely to follow.

The company could also suffer financially from more than just lawsuits. Pilot’s corporate credit rating was already downgraded by Standard and Poors last July from BB-plus to BB. The Wall Street Journal reported Monday that S&P said at the time “it  viewed  the  financial-­risk  profile  of  the  company  as  ‘significant  because  its owners’  influence  could  impede  credit  quality  despite  good  cash  flows  and  “adequate” liquidity.’” If the company is forced to take on more debt to repay customers or settle lawsuits, the credit rating could fall further.

Although competitors like Love’s may benefit from the scandal, it’s still unlikely that Pilot will face a massive exodus of customers. In the end, like certain other corporations investigated during recent years, they may be just too big to fail.

© 2013 MetroPulse. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

Comments » 1

SteveRoss writes:

So, the board of directors has oversight of this "special investigator".

That's cool.

Who's on the board of directors again?

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