Business
4:17 pm
Wed May 29, 2013

Two Pilot Employees Plead Guilty in Fraud Investigation

Credit Moxley Carmichael Public Relations

The Associated Press reports two employees of the Pilot Flying J truck stop chain have pleaded guilty in a federal probe of the company’s business practices.

Northeastern sales director Arnold Ralenkotter pleaded guilty Wednesday to one count of conspiracy to commit mail fraud in U.S. District Court in Knoxville. Regional accounts representative Ashley Smith Judd also pleaded guilty to conspiracy.

They are the first to be charged in the investigation that has been underway since 2011. Federal prosecutors allege members of Pilot’s sales team deliberately withheld rebates to boost Pilot profits and pad sales commissions. A Pilot spokeswoman declined to offer comment to the Knoxville News Sentinel.

The Knoxville-based chain is run by CEO Jimmy Haslam, brother of Governor Bill Haslam. Their father established the business in 1958.

UPDATE, 5:22 p.m. ET: Pilot Flying J spokesman Tom Ingram issued a statement on today's pleas.

“The statements released by the federal court today do not come as a surprise given what we’ve been learning in our own internal investigations, but are nonetheless disappointing. We want to assure our customers that we are taking every step to correct any wrongdoing that has occurred and to make certain that it does not happen again.”