Three Pilot employees plead guilty to conspiracy, mail fraud charges in rebate withholding case

Click here to see more of CCJ’s coverage of Pilot’s alleged rebate withholding scheme, the settlement and employees who have pleaded guilty to fraud charges.Click here to see more of CCJ’s coverage of Pilot’s alleged rebate withholding scheme, the settlement and employees who have pleaded guilty to fraud charges.

Three more Pilot Flying J employees have pleaded guilty to fraud or conspiracy charges surrounding accusations that the company systematically cheated trucking companies out of millions in owed fuel rebates over a seven-year period.

Christopher Andrews, a regional sales manager, and and Lexie Holden, a regional account representative, both have pleaded guilty to one count of conspiracy, and Brian Mosher, a regional sales director in the direct sales division, pleaded guilty to one count of conspiracy to commit mail fraud and wire fraud.

Andrews and Holden could face up to five years in prison, a fine of up to $250,000 and up to three years of supervised release.

Mosher could face up to 20 years in prison, a fine of up to $250,000 and up to three years of supervised release.

So far, 10 employees have pleaded guilty to fraud, conspiracy or similar charges in the case.

The charges for Andrews, Holden and Mosher stem from altering spreadsheets to change the fuel rebate Pilot owed to a diesel fuel customer, based on a contract between the customer and Pilot, and then either emailing or mailing the falsified spreadsheets to other Pilot employees.

Many of Pilot’s contracts with customers included either “cost-plus” or “retail-minus” pricing for diesel purchases, and many of the customers’ rebates would be calculated manually by Pilot employees, so called manual rebate calculation — the source of the fraud allegations.

Pilot announced in September it had ended that practice.

Pilot’s Knoxville headquarters were raided in April 2013 by FBI agents, who sent non-essential employees home and seized documents and electronic evidence.

An affidavit was released three days after the raid detailing the fraud accusations against Pilot.

Pilot settled a class-action lawsuit in the matter in November, agreeing to pay about $85 million to a class of 5,500 trucking companies. The $85 million included the principle funds owed in fuel rebates, along with 6 percent interest and attorney’s fees and auditing costs.

The truck stop chain announced earlier this month that by Dec. 31 it had paid 95 percent of the 5,500 companies in the class.

Also this month, a judge cleared Pilot of racketeering claims brought in a lawsuit by an Alabama-based carrier.