Justice Served Up Daily
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Pilot Travel Centers logo. (Photo credit: Wikipedia)

Here is what we are reading today:

Bridgestone Tire Execs Charged With Price Fixing (Reuters)One Bridgestone Corp (5108.T) executive and two former officials from the company were indicted Tuesday for conspiring to fix the prices of certain automotive parts, the Justice Department said on Tuesday.  Bridgestone itself agreed in February to plead guilty to price-fixing and agreed to pay a $425 million criminal fine. The case involves anti-vibration parts used in automotive suspension systems and engine mounts.

Compliance, A Well-Paying Job With Unknown Results (DealBook)In the insider trading case against SAC Capital Advisors, federal prosecutors have given a particularly nice gift to a former federal prosecutor, Bart M. Schwartz. Mr. Schwartz, who is now the chairman of the consulting firm Guidepost Solutions, was appointed SAC’s independent compliance consultant and is charged with assessing the firm’s future trading practices.  The job is likely to earn Mr. Schwartz millions, but it will do little more than that. It’s all part of the corporate monitoring industry, a full employment act for former federal prosecutors that may have little effect on the way any company that is forced to hire a monitor conducts its business.

A Year After Pilot Flying J, The Investigation Goes On ... And On (WBIR) - One year after federal agents raided Pilot Flying J headquarters in Knoxville, all signs point to a fraud investigation that is far from over for the Haslam family's truck stop empire. On April 15, 2013, the FBI raided the headquarters of the nation's largest truck stop chain and diesel dealer as part of an investigation into fuel rebate fraud. Affidavits indicated the feds began investigating in May 2011 after receiving a tip from a Pilot employee that the sales team implemented a scheme to short-change "unsophisticated" trucking companies on rebates.  In the last year, 10 people employed by Pilot Flying J have pleaded guilty to conspiracy and fraud charges in federal court. None of the employees who pleaded guilty had actually been charged with a crime at the time of their admission.

Could NFL Rules Come Into Play Against Browns Owner Jimmy Haslam (Plain Dealer) - Ten people who worked for his family-owned Pilot Flying J have pleaded guilty to charges tied to defrauding trucking companies that bought diesel fuel at Pilot's service station plazas.  Haslam has not been charged, and he has maintained he had no knowledge of any rebate shortages until the FBI raid on his Knoxville, Tennessee-based business one year ago today.  But with each turn of the screw - the U.S. Justice Department investigation is expected to last well into 2014 and perhaps beyond - speculation grows about how the probe into one of Haslam's businesses is playing out in another: the Cleveland Browns.

Not All Investigations Are Alike (DealBook) -  Say a company finds out that it is under investigation for possible criminal violations. Its challenge is to figure out the chances that the investigation will result in charges and the possible impact of those charges on its business. Not all investigations are alike, and there are telltale signs about how serious a threat one may present.  Federal prosecutors have broad authority to initiate grand jury investigations, which often start with issuing subpoenas for documents. There is no requirement for prior judicial approval of a subpoena, unlike a search warrant, which can only be issued if there is probable cause a crime took place. As the Supreme Court pointed out in Branzburg v. Hayes, a case involving a demand for a reporter’s notes, “an investigation may be triggered by tips, rumors, evidence proffered by the prosecutor, or the personal knowledge of the grand jurors.”

Citigroup Finds Second Fraud In Mexico (Washington Post) - Citigroup said Monday that it has discovered another case of fraud in its accounts-receivable program involving a supplier to Mexican oil giant Pemex, raising questions about the bank’s ability to manage its sprawling global footprint.  The revelation comes two months after Citigroup alleged that it had uncovered at least $400 million in fraudulent loans to Oceanografia, which supplies oil services to Pemex. The latest case involves less than $30 million in loans made to another Pemex supplier, whose name Citigroup would not disclose.

Tutor Center Scammed Feds For $2 million (NY Post) -  A bicoastal tutoring center — whose website boasts endorsements from actor/former Calif. Gov. Arnold Schwarzenegger and former New York and LA schools chief Ramon Cortines — has agreed to shell out a $2 million settlement to the feds after confessing it falsified documents to solicit public funding for services never provided.  Under a settlement deal with the government announced Tuesday, The Academic Advantage, based in Manhattan, admitted bilking taxpayers out of federal funds by forging students signatures on attendance sheets for years to make it seem as if more were attending tutoring classes.

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