Former Rite Aid Vice President Sentenced To 2 Years’ Imprisonment On $5.7 Million Vendor Kick-Back And Tax Evasion Charges

HARRISBURG – The U.S. Attorney’s Office for the Middle District of Pennsylvania announced that former Vice President for Rite Aid, Inc. (Rite Aid), James W. Pilsner, age 61, of Harrisburg, Pennsylvania, was sentenced to two years’ imprisonment followed by two years on supervised release on October 23, 2019, by U.S. District Court Judge John E. Jones, III, for perpetrating a vendor kick-back scheme that defrauded the Company out of $5.7 million and for committing tax evasion.

According to U.S. Attorney David J. Freed, Pilsner pleaded guilty to one count of wire fraud and one count of tax evasion on October 1, 2018. Pilsner, a former Vice President for Advertising for Rite Aid, perpetrated a kick-back scheme with the owner of Nuvision, a small Atlanta, Georgia based company between 1995 and August 2017. Nuvision provided $45 million of pre-press advertising services to Rite Aid under contracts granted by Pilsner during that time period.  During the same period, Pilsner received $5,124,862 in kick-backs from Nuvision and distributed another $634,300 from Nuvision to some of his Rite Aid employees.

Pilsner paid $300,000 to the IRS at the time he entered his guilty pleas and paid the balance that he owed the IRS, $292,386, at sentencing.  Judge Jones also ordered Pilsner to pay $5,743,162 in restitution to Rite Aid.  Jones directed Pilsner to commence service of his sentence on January 6, 2020.

The case was investigated by the Harrisburg office of the Federal Bureau of Investigation and the Internal Revenue Service, Criminal Investigation Division.  AUSA Kim Douglas Daniel prosecuted the case.