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Pilot Flying J CEO: will apologize 'face to face' with customers, cease manual billing process

Pilot Flying J CEO Jimmy Haslam has said he will apologize to fuel customers and that some fuel sales staff are being put on administrative leave.

The Trucker Staff

4/23/2013

Pilot Flying J CEO Jimmy Haslam Monday in a public statement said he will apologize “face to face” with customers who have been outraged and hurt by growing revelations of how the nation’s largest truck stop operator has allegedly defrauded trucking companies out of millions of dollars worth of fuel rebates owed to them.

Haslam made the comment in a departure from a scripted speech apparently in response to aggrieved customers’ comments that appeared in The Tennessean newspaper in Nashville.

Haslam mentioned Titan Transfer Inc. owner and former American Trucking Associations Chairman Tommy Hodges by name, saying “for someone we know and respect,” Hodges’ comments in print “were especially painful to read.”(Click here for the full story on comments.)

Haslam admitted the company's credibility had taken a direct hit. "I, more than anybody, understand the damage that's been done to our reputation, our brand and our relationships in the trucking community," Haslam said. "Eight days ago I think we had the best relationships, the best trust in the trucking industry. And we now have the worst. I understand that, I accept responsibility for it."

Privately held Pilot Flying J posted $29 billion in revenues in 2012.

In his prepared comments Haslam outlined five steps Pilot Flying J is taking in response to the federal investigation into the truck stop chain, stressing, “This is how seriously we are taking this.”

Among the five steps is ceasing to process fuel bills manually and converting them to electronic calculation and payment, “eliminating future risks of any abuse that might be enabled by manual calculation and payment.”

He said the process will “fully eliminate manual processing at Pilot Flying J and place all of our customers on direct bill.” The process is to be completed by June 30.

Haslam said the other steps being taken are placing several members of Pilot Flying J’s diesel fuel sales team on administrative leave “on an interim basis,” which was done Sunday, and creating a staff position of Chief Compliance Officer to report to the company’s general counsel on any similar fuel bill issues which come up in the future. According to unsealed affidavits, members of the sales team allegedly preyed on smaller trucking companies who employees said were “too unsophisticated” to catch the fraud by reducing the amount of rebates they were owed.

Haslam had said Friday that the federal probe is only aimed at a “narrow band” and a “very small percentage” of its customers.

However, he said Monday that as part of its five-step plan Pilot Flying J is bringing in a company field audit team to “review all 3,300 contracts with our trucking company customers, not just the relative few implied in the federal affidavit,” and hiring a “special independent investigator to oversee and validate all of our internal inquiries” related to the investigation.

Haslam declined to name the independent investigator, who he said didn’t want their name mentioned yet, but called the person “someone whose credibility is beyond reproach.”

A Pilot Flying J employee told investigators that Haslam knew about rebate fraud at the truck stop chain his family owns, according to the FBI affidavits.

FBI and IRS agents locked down Pilot Flying J’s headquarters in Knoxville on April 15, a week ago.

Haslam, who owns the Cleveland Browns, has said he would not step down from his role with the Browns during the investigation.

The Trucker staff can be reached to comment on this article at editor@thetrucker.com.

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The Trucker staff can be reached to comment on this article at editor@thetrucker.com.

Find more news and analysis from The Trucker, and share your thoughts, on Facebook.

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