A major shake up is hitting the North American trucking industry, as Indiana based Celadon Group Inc. is seeking Chapter 11 reorganization. The Indianapolis based trucking company is listing $427 million in assets, $391 million in debts including a huge restitution payment of $33 million owed to the federal government as the result of a probe into a fraud scheme that investigators charge cost shareholders and investors $60 million due to the overvaluation of Celadon trucks.
The news means 4,000 employees will be losing their jobs and 3,300 trucks and 10,000 trailers will stop rolling.
Last week, U.S. Attorney for the Southern District of Indiana Josh Minkler announced that former Celadon Chief Operating Officer William Eric Meek and former Chief Financial Officer Bobby Lee Peavler where charged with conspiracy to commit wire fraud, bank fraud and securities fraud, along with other counts, for allegedly concealing the diminishing value of Celadon’s truck fleet, making it appear the company was worth more to investors than its actual value.
The unraveling of the alleged scheme comes as the North American trucking industry is in a slump.
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