The fraud trial of Flying Tigers and its president, Jay Stout, began last Friday in Philadelphia federal court before U.S. District Judge Harvey Bartle III. One of the prosecution’s primary witnesses is Stout’s son Joel, who is awaiting sentencing after pleading guilty in March last year to one count of fraud and six counts of mail fraud. Both Stouts, the company and mechanic/inspector Howard “Bud” Gunter were indicted in August 2012 for allegedly charging aircraft owners for inspections that were not conducted by FAA-certified inspectors.
The Philadelphia U.S. Attorney’s Office has indicted Flying Tigers of Lancaster, Penn., its president Jay Stout and his son Joel Stout, with various crimes, including conspiracy, fraud involving aircraft parts, wire fraud and obstruction of justice. Also indicted was Howard Gunter, a former FAA certified mechanic and inspector, on charges of conspiracy and fraud involving aircraft parts.
The U.S. Attorney for the Southern District of Florida, in conjunction with the U.S. Department of Transportation, the Federal Bureau of Investigation, the U.S. Department of Labor, U.S. Immigration and Customs Enforcement, Florida’s Department of Economic Opportunity and the FAA, has announced a 21-count indictment charging 16 defendants in connection with the continued operation of Aircraft Transparencies Repair (ATR) of Hialeah, Fla., after the FAA revoked the company’s operating certificate.
The National Air Transportation Association (NATA) is calling on its members to urge their congressional representatives to include language in pending legislation to repeal the “fuel fraud” provision. The provision, part of the 2005 Highway Bill, changed the collection of taxes for non-commercial jet fuel and required them to be deposited into the Highway Trust Fund.
In the ongoing trial of Platinum Jet executives in Newark, N.J., a U.S. district judge took the unusual step last week of dismissing charges against one of the three men–former director of maintenance Brien McKenzie–saying the prosecution failed to prove its case against him.
Swindler Bernard Madoff’s charter company, BLM Air Charter, filed for voluntary bankruptcy (Chapter 11) in the U.S. Bankruptcy Court Southern District of New York on November 12. The bankruptcy filing lists two creditors as holding the largest unsecured claims: Embraer Aircraft Customer Service, with a claim of $240,728.50; and Rolls-Royce, with $181,289.76.
Last year Jerry Roy Comeaux and his wife, Vicki, were indicted for “conspiracy to commit fraud, fraud involving aircraft parts, mail fraud, wire fraud, conspiracy to commit money laundering, and money laundering,” according to the U.S. District Court of South Carolina. On Monday, Comeaux pleaded no contest to the felony charges and was sentenced to three years’ probation and payment of more than $400,000 to victims.
Nav Canada is warning aviators about a fraudulent e-mail, purportedly from the organization, that attempts to notify operators “of an outstanding debt in the area of air navigation service charges for the year 2007.” According to a spokesman, the e-mail is part of a “fraudulent billing scheme targeting our customers.
An elaborate scam originating in South Africa threatens to bilk business aviation interests out of substantial sums of money, according to Canadian consulting firm Business Aviation Service Solutions (Bass). It has been investigating the aircraft brokerage scheme, which is linked to the 2010 FIFA Football World Cup Finals.
As companies merge, expand, downsize, change top executives or declare bankruptcy, their flight departments are often significantly affected. In the past several weeks, four major companies with flight departments have filed for protection under Chapter 11. More than 20 corporate jets were operated by these four companies, and none is currently more visible than Enron.
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