Former Rite Aid VP pleads guilty in $5.7M kickback scheme

//October 2, 2018

Former Rite Aid VP pleads guilty in $5.7M kickback scheme

//October 2, 2018

The U.S. Attorney’s Office for the Middle District of Pennsylvania said James Pilsner, 60, of Harrisburg, a former vice president for advertising at Rite Aid, engaged in the scheme with two owners of an Atlanta-based company between 1995 and 2017.

Investigators said Pilsner entered into an agreement with Larry Nuckols and Vance Taylor, the owners of Nuvision Inc., a consumer electronics company. He would approve Nuvision’s invoices, some of which were false and inflated, for payment by Rite Aid. In exchange, Pilsner received a kickback from those payments.

Cumberland County-based Rite Aid allegedly paid Nuvision approximately $45.3 million between 2001 and August 2017.

Pilsner allegedly received at least $5.1 million in kickbacks over that time, with another $634,300 paid to other Rite Aid employees designated by Pilsner, the U.S. Attorney’s Office said. Officials declined to comment whether there are any active investigations of other employees.

Additionally, Pilsner is charged with income tax evasion for tax year 2013. In March 2014, Pilsner allegedly filed an income tax return with the IRS that did not report his receipt of $411,500 in kickback money during 2013, avoiding approximately $157,648 in federal income taxes.

U.S. Attorney David Freed’s office seeks the forfeiture of Pilsner’s interests in $5.7 million and his Harrisburg residence. On Monday, Pilsner paid $300,000 toward his tax restitution obligation of $592,000 for the period 2013 to 2017. He also agreed to pay the balance at sentencing.

Pilsner’s attorney was not immediately available for comment.

Meanwhile, Taylor, 71, was indicted Sept. 19 on 40 counts of mail fraud, wire fraud and money laundering. He is still awaiting his initial appearance and arraignment on the charges. Nuckols, 69, is slated to plead guilty to wire fraud on Nov. 20.

Attorneys for the two men, both from Georgia, were not immediately available for comment. In a previous interview, an attorney for Taylor said he planned to plead not guilty.