HARRISBURG — The former vice president of advertising for Rite Aid will serve two years in prison, followed by two years of supervised release, for perpetrating a vendor kick-back scheme that defrauded the company out of $5.7 million and for committing tax evasion, according to the U.S. Attorney’s Office for the Middle District of Pennsylvania.
James Pilsner, 61, was sentenced Wednesday, more than a year after he pleaded guilty to wire fraud and tax evasion in connection with the scheme.
U.S. Attorney David Freed said Pilsner, of Harrisburg, approved false and inflated invoices from Atlanta-based company Nuvision for payment and in exchange, the owners of Nuvision would “kick-back” a significant portion of Rite Aid’s payment back to Pilsner.
The scheme took place between 1995 and August 2017, and according to Freed, Nuvision provided $45 million of pre-press advertising services to Rite Aid under contracts granted by Pilsner. During that same time frame, 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 then $292,386 at sentencing.
Also at sentencing, Pilsner was ordered to pay $5,743,162 in restitution to Rite Aid.