FBI Uncovers Fuel Scandal that Puts Trucking Industry Into a Tailspinby Jana Ritter - Published: 4/23/2013
With a 20-page affidavit to obtain the search warrant, the FBI and Internal Revenue Service agents raided the Pilot Flying J headquarters last week, stunning the company. As word about the raid has spread throughout the trucking industry, its caused mass confusion amongst Pilot J's biggest demographic of customers and the victims at the heart of the alleged scheme.
While the investigation is continuing and neither the company nor any employees have been charged, the FBI's allegations are that of an elaborate diesel-fuel rebate fraud by truck-stop giant Pilot Flying J. The affidavit asserts that the alleged scheme began in 2008, a very tough year for truckers when trucking-company failures soared 54% to 3,065. In order to gain these trucking firms as loyal, repeat customers, the Pilot Flying J introduced a diesel fuel rebate program where companies would earn rebates by sending theirs truck to Flying J for fueling. It is now alleged that customers were deliberately cheated out of their rebates and paid less than promised. The FBI's affidavit suggests that millions of dollars were withheld from the trucking companies and profited the Pilot Flying J.
Trucking companies around the nation are in shock and disgust, while some are less surprised – seeing the news as confirmation of something they've long suspected. "We fit the profile of exactly what they were doing. We were in the rebate program, and we always had a tough time reconciling the checks we were getting with our records of fuel purchases. Sometimes when we were expecting $50,000, we would get only $35,000, and when we would call, we never got a straight answer about the discrepancy. When we would get a check, nothing would come with it explaining it," explains one carrier company owner.
Pilot Flying J has more than 650 locations and 23,000 employees, being not only the biggest fuel source used by the trucking industry, the company also buys fuel from nearly every US refinery and has a reputation as one of the most well managed fuel buyers in the country.
In addition the outrage amongst the overcharged trucking consumers, all the suppliers are in a state of shock right now and concerned about Pilot's future ability to pay – having always been a creditworthy company.
But perhaps most offensive are the comments by Pilot employees listed in affidavit, suggesting the company didn't cheat all of its customers, only the ones who were "too unsophisticated" to detect the fraud. At one point, the affidavit asserts that sales employees discussed the potential for "a new internal Pilot two-tiered pricing structure that would impose higher prices on less sophisticated customers."