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Defendants Sentenced in $12.9M Rite Aid Fraud Scheme
HARRISBURG – In a shocking case of corporate greed, two high-ranking Rite Aid executives have been sentenced to prison for their roles in a brazen $12.9 million fraud and kickback scheme that duped the company out of millions of dollars.
According to the United States Attorney’s Office for the Middle District of Pennsylvania, Jay Findling, 55, of Manalapan, New Jersey, was sentenced on November 16, 2016, by United States District Court Judge John E. Jones, III, in Harrisburg, to 48 months’ incarceration for his role in the scheme. Findling pleaded guilty in February 2015 to an information charging him with conspiracy to commit wire fraud.
In a separate proceeding, Judge Jones sentenced former Rite Aid Vice President Timothy P. Foster, 66, of Portland, Oregon, to 60 months’ incarceration. Foster pleaded guilty in February 2015 to an information charging him with false statements to authorities.
The scheme, which lasted from 2001 to 2010, involved Foster’s company, J. Finn Industries, LLC, purchasing surplus inventory from Rite Aid at inflated prices, with Findling then kicking back a portion of the profits to Foster. The scheme allowed Findling to reap a profit of approximately $29.1 million, with $5.9 million of that amount being kicked back to Foster, primarily in the form of cash.
The total loss to Rite Aid was $12.9 million, with Findling and Foster ordered to jointly pay $8,034,183 in restitution. Findling was ordered to pay $6,257,997 within 15 days of sentencing, while Foster was ordered to pay $1,776,186 by the end of the year.
Both Findling and Foster are set to voluntarily surrender to the Bureau of Prisons on January 17, 2017. The case serves as a stark reminder of the devastating consequences of corporate greed and the importance of holding executives accountable for their actions.
Key Facts
- State: Pennsylvania
- Category: Fraud & Financial Crimes
- Source: DOJ Press Release â†â€â€
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