Four former Pilot Flying J employees officially agreed Monday to plead guilty in the company’s diesel fuel rebate scam, reports WSMV Channel 4.
John “Stick” Freeman, the mastermind of the scheme, along with John Spiewak, Vicki Borden and Katy Bibee, signed plea agreements filed in U.S. District Court for the Eastern District of Tennessee.
With Monday’s filings, there are now 14 sales staff members and executives who have agreed to confess and talk, according to the Knoxville News Sentinel.
Pilot Flying J, which is headquartered in Knoxville and operates hundreds of gas stations and convenience stores in the U.S. and Canada, is owned by the family of Tennessee Gov. Bill Haslam. The billionaire CEO is his brother Jimmy Haslam, who also owns the Cleveland Browns. Their father founded the company in 1958.
Jimmy Haslam has not been charged in the scandal, although the FBI indicated in testimony and court records that he was a suspect, according to the News Sentinel. He has denied knowing about the scam. Gov. Haslam has not been involved in running the company for many years but has an ownership share in the business. He has said his holdings were placed in a blind trust when he was elected governor in 2010.
Freeman, the former vice president of sales, is known as the architect of the multi-million dollar scam, which involved short-changing trucking companies on promised rebates. Freeman pleaded guilty to conspiracy to commit mail fraud and wire fraud, documents show. He faces up to 20 years in prison and a $250,000 fine.
Spiewak was a regional sales manager for Pilot Flying J, Borden was director of direct sales, and Bibee was an account representative who worked directly with Freeman.
FBI and IRS agents raided the Knoxville headquarters in April 2013 after obtaining evidence of the scheme.
A Pilot Flying J spokesperson released the following statement after the filing of Monday’s plea agreements:
We are saddened by news of the pleas of four people who worked for Pilot Flying J acknowledging that they participated in defrauding some of our diesel fuel customers. After learning of such improper activities more than four years ago, we made whole every customer negatively affected; entered into a Criminal Enforcement Agreement with the government, which included a $92 million penalty; continued to cooperate with the investigation; and made policy, procedure and staff changes to make certain nothing like this happens again.
It is Pilot Flying J’s commitment to be a great partner to trucking companies across North America, always focusing our undivided attention on the best interests of our customers, team members and business.