Jimmy Haslam, CEO of Pilot Flying J, knew about a fuel rebate scheme at his company and “loved it,” according to what an executive said in a secret recording that jurors heard in court Tuesday.
Haslam, brother of Tennessee Gov. Bill Haslam and owner of the Cleveland Browns football team, has denied knowledge of the widespread fraud scheme and has not been charged.
Four former employees of the truck stop chain are currently on trial in U.S. District Court in Chattanooga. In all, 18 former employees were charged in the scheme and 14 pleaded guilty. The fraud involved shorting trucking companies on promised diesel fuel rebates.
“He knew – absolutely,” John “Stick” Freeman, former Pilot Flying J vice president of sales, said of Jimmy Haslam in the recording played in court Tuesday, according to the Knoxville News-Sentinel.
Federal prosecutors released a transcript of the recording after Pilot Flying J was raided by federal agents in 2013, but Tuesday was the first time the recording was heard publicly. The recording was made by Vincent Greco, then a sales director for the company, who wore a wire for investigators.
Freeman said in the recording that former president Mark Hazelwood also knew about the scheme. Hazelwood, who has denied participating in the fraud, is among the four currently on trial.
The Knoxville News-Sentinel reports:
In the recording, Freeman explained that “we’ve all had cases where we’ve gotten busted,” meaning situations in which a trucking company discovered they were being shorted. Freeman told the pair he got caught by Western Express in Nashville to the tune of $1 million. To soothe Western Express, Pilot Flying J bought a broken-down airplane from the firm for $1 million.
“What does Mark (Hazelwood) and Jimmy (Haslam) say about (expletive) like that?” Greco asked.
Freeman said both Hazelwood and Haslam knew. He told them, he said.
“(Expletive),” Freeman said. “I mean, I called Jimmy and told him I got busted at Western Express … He knew – absolutely. I mean, (Haslam) knew all along that I was cost-plussin’ (code for the fraud scheme) this guy. He knew it all along. Loved it. We were making $450,000 a month on (Western Express).”
Pilot Flying J reissued a statement after Tuesday’s testimony saying, “As we have said from the outset, Jimmy Haslam was not aware of any wrongdoing.”
The company is a Haslam family business. Gov. Haslam still has an ownership share but has not been involved in running the business for many years.