(INDIANAPOLIS) — An Indiana trucking company with nearly 4,000 employees said on Monday that it filed for bankruptcy and will shut down all operations, just days after two former officials were charged in a fraud scheme.
Celadon Group has faced significant costs related to a federal investigation and also must deal with debt and “enormous challenges” in the industry, chief executive Paul Svindland said in a statement.
William Meek, 39, and Bobby Lee Peavler, 40, were indicted on conspiracy and other charges. They knew the value of a substantial portion of Celadon’s trucks had declined and that many trucks had serious mechanical issues that made them unattractive to drivers, according to the indictment.
Earlier this year, Celadon agreed to pay $42.2 million to settle securities fraud allegations stemming from falsely reporting profits and assets.
Celadon said it was the largest provider of international truckload services in North America.
“We have diligently explored all possible options to restructure Celadon and keep business operations ongoing. However, a number of legacy and market headwinds made this impossible to achieve,” Svindland said.