Judge Collier Sentences Former Pilot President Mark Hazelwood To 12 1/2 Years In Federal Prison; One Of State's Most Wealthy People Must Report After Thanksgiving

  • Wednesday, September 26, 2018

Federal Judge Curtis Collier on Wednesday sentenced former Pilot Travel Centers president Mark Hazelwood to 12 1/2 years in federal prison.

The judge said he could not remain free during the appeal. However, he was allowed to remain in home confinement at his residence in Knoxville until reporting just after Thanksgiving.

The sentencing range was 135 to 168 months after the judge declined several defense motions for sentencing leniency.

Hazelwood, speaking before a courtroom of his supporters, said, "I am devastated where I find myself today."

He said, "I will appeal and I do maintain my innocence." But he added, "I am deeply sorry. We should have had policies in place" to prevent a fraud against trucking companies. He said, "I've made many mistakes along the way."

Hazelwood became more emotional as he spoke of a tape introduced at his trial of a racist song being played at a lake house sales meeting and racist comments he made. He said, "I am truly ashamed and heart-broken over that. There is not a racist bone in my body."

Hazelwood, whose attorney said he is involved in daily Bible study at his home, said, "I cling daily to my faith in God and my savior Jesus."

He asked for the least sentence possible, saying he wanted to continue to help others and enjoy his grandchildren.

At the start of the hearing, the judge said he had received over 165 letters in support of the man who built the Knoxville-based firm into one of the largest fuel suppliers in the world. Among those asking for leniency were coaches Urban Meyer and Bruce Pearl as well as Chattanooga trucking executives Max Fuller and David Parker.

Judge Collier said many of the letter writers said they believed the jury convicted Hazelwood because they felt he was a racist. The judge said that was not the basis of the conviction.

The judge also said the justice system does not focus on "whether you are a good person or a bad person" but whether the defendant committed the crime.

Defense attorneys said they would not resist the prosecution's request that Hazelwood pay a $750,000 fine, but said they wanted to focus on the prison term. The Hazelwood net worth was put at $52 million. Judge Collier ruled that he pay $250,000 on each of the counts he was convicted on.

The defense said none of the losses to trucking companies in the rebate fraud rose to the level of disrupting their business.

It was also argued that Hazelwood only profited $21,000 per year from the fraud as opposed to a much higher figure given by the government.

He was called a pioneer in the industry who helped make life better for truckers and who also gave to many causes.

Prosecutor Trey Hamilton said the Hazelwood motive was personal enrichment to some degree but mainly to use the fraud to induce trucking customers to buy diesel fuel from Pilot - not its competitors.

Judge Collier said Hazelwood was "extremely and intensely competitive. He wanted Pilot to be the largest and biggest dog on the block."

The judge said their were some similarities between Hazelwood and financier Bernie Madoff, who got a 150-year sentence. He said both came from low circumstances and worked hard to build their companies. He said others put faith in them due to their strong reputations.

Judge Collier said Hazelwood "abused the trust that Pilot and the industry had placed in him." He said the fraud, in which firms were promised certain rebates that were not delivered, captured more diesel gallons for Pilot and "fed his ego and his competitiveness."

He noted that after a federal raid at the Pilot headquarters that Hazelwood made a call to his longtime assistant in which he, in effect, asked her to lie for him about travel reports. He said that put the assistant in the position of possibly committing perjury and "put mental and more strain on her."

Judge Collier said Hazelwood's actions harmed Pilot, causing it to have to pay out some $57 million to affected trucking firms and to have its reputation stained.

He said almost 20 people were involved in the fraud. He said it was one in which "the higher ups do not do the dirty work. They do not leave fingerprints." He said, "With so many people involved this became much more dangerous to the community than individual criminal activity."

The judge said employees who were involved "often bragged and laughed about it" and talked "in extremely profane language" about unsuspecting customers who were being bilked. He said the fraudulent conduct "became expected and accepted."

Judge Collier said most of these were small companies, and he said some of them must have felt the effects of the lost revenue.

The government had asked that Hazelwood be detained, saying he is a flight risk due to the sentence he faces. However, Judge Collier agreed with the defense that "he's not going to run."

 

 

 

 

 

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