Pilot Flying J Agrees to $92M in Criminal Fines Over Fuel Rebate Scam

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Pilot Flying J, the truck stop chain controlled by Cleveland Browns owner Jimmy Haslam, will pay $92 million in criminal fines over its fuel rebate scam that reportedly cheated truck drivers out of diesel fuel rebates.

According to a Criminal Enforcement Agreement with the U.S. Attorney’s Office for the Eastern District of Tennessee, Pilot Flying J agreed to pay the $92 million fine to avoid prosecution for the fuel rebate scam. The penalty, which is based on federal sentencing guidelines, will be paid over a period of two years. The company also promised it would continue to assist criminal investigators.

“The company has accepted its responsibility for the criminal actions of its employees and has agreed to cooperate fully pursuant to the agreement with the investigation being conducted by the United States Attorney’s Office for the Eastern District of Tennessee, Federal Bureau of Investigation and the Internal Revenue Service-Criminal Investigations,” the Criminal Enforcement Agreement says.

As long as Pilot Flying J abides by the terms of the agreement, the company will not face prosecution. However, the agreement does not protect individuals at the company from prosecution. The $92 million deal also does not put an end to the FBI and IRS investigations into the fuel rebate scheme.

Pilot Flying J has 650 retail locations in the United States and employs around 23,000 people. The company has reported annual revenues of nearly $30 billion.

Agents from the FBI and IRS raided the company’s Knoxville, Tenn. headquarters in April 2013. At least 20 class action lawsuits were filed against Pilot Flying J after the FBI released a 120-page affidavit pertaining to Pilot’s systematic reduction in rebates. According to court documents, the scheme ran from at least 2007 until the FBI’s raid in 2013.

Since last year, 10 Pilot employees have pleaded guilty to wire and mail fraud charges. According to federal prosecutors, the company acknowledged that it has defrauded customers of more than $56 million.

Last summer, Pilot Flying J reached a class action settlement over claims Haslam implemented a “nationwide scheme to defraud and cheat” its trucking customers. The $72 million class action settlement received final approval in November. At least 50 plaintiffs opted out of the fuel rebate scam settlement.

Earlier this year, several Pilot Flying J class action lawsuits were consolidated by the U.S. Judicial Panel on Multidistrict Litigation. The fuel rebate scam lawsuits allege that Pilot implemented a customer loyalty fuel rebate program that would refund or credit a certain percentage of fuel purchases for members. However, the class action lawsuits alleged that Pilot intentionally reduced and withheld payments as part of an intentional scheme to defraud members and increase the company’s profits. Other companies have filed separate fuel rebate lawsuits against Pilot Flying J, which are still ongoing.

More information about the Pilot Flying J settlement was not immediately available. Keep checking TopClassActions.com or sign up for our free newsletter for the latest updates. You can also mark this article as a “Favorite” using your free Top Class Actions account to receive notifications when this article is updated.