Have Airline Executives Ever Been Jailed?

lmml 14/32 · Tue Feb 21, 2012 4:55 pm

Have any airline executives ever been convicted and jailed over mismanagement and corruption while holding executive or other important position with "their" airline?

Rdh3e · Tue Feb 21, 2012 5:30 pm

Quoting lmml 14/32 (Thread starter):
Have any airline executives ever been convicted and jailed over mismanagement and corruption while holding executive or other important position with "their" airline?

Mismanagement isn't a crime. Not sure about any financial crimes though.

flyorski · Tue Feb 21, 2012 5:56 pm

Some people believe this should have happened at TWA. In my mind no evidence ever surfaced that could even theoretically be prosecuted. I am not sure what reasons they have nor whom they blame for the failure of TWA. There is a reason for the impartial justice system, separated from the "horror" employees might go through.

Moose135 · Tue Feb 21, 2012 5:58 pm

In the US, executives don't receive jail time for mismanagement and corruption, they receive buy-out packages and consulting deals...

apodino · Tue Feb 21, 2012 6:38 pm

This weeks episode of American Greed is about Tom Petters, who was CEO of the parent company of Sun Country Airlines for a few years. This parent company was Petters Group Worldwide, and it was later revealed to be a ponzi scheme, and thus Tom Petters is sitting in prison today.

If you are all interested the episode will air on CNBC Wednesday night at 10 ET.

flyorski · Tue Feb 21, 2012 6:43 pm

Quoting apodino (Reply 7):
This weeks episode of American Greed is about Tom Petters, who was CEO of the parent company of Sun Country Airlines for a few years. This parent company was Petters Group Worldwide, and it was later revealed to be a ponzi scheme, and thus Tom Petters is sitting in prison today.

If you are all interested the episode will air on CNBC Wednesday night at 10 ET.

Sounds very interesting. I will try to catch that.

F9Animal · Tue Feb 21, 2012 7:10 pm

Barry Michael's who scammed people at Family Airlines was put in prison. He is back at his old game, and even ran for Congress.

Salmonela · Tue Feb 21, 2012 7:27 pm

easyJet CEO Raj Rajaratnam was sentenced to 11 years for insider trading. Don't know how much (if any) he served.

CEO of Cargolux, Ulrich Ogiermann, and his top deputy accepted sentences of 13 months in prison and fines for cargo price fixing.

Also, not sure I'd call it a "real" airline, and I don't know if there was ever a conviction but...
http://abclocal.go.com/wtvd/story?section=news/local&id=7027205

I also recall a French airline (TAT, Air Liberte?) official doing a couple years after a crash, but it might have been the pilot and not an exec.

PresRDC · Tue Feb 21, 2012 9:35 pm

Google "air cargo cartel."

http://www.aircargoworld.com/Air-Car...d-in-airfreight-cartel-case/093872

[Edited 2012-02-21 13:37:17]

Viscount724 · Tue Feb 21, 2012 9:54 pm

Quoting Salmonela (Reply 10):
easyJet CEO Raj Rajaratnam was sentenced to 11 years for insider trading.

Raj Rajaratnam was NEVER easyJet's CEO. No involvement whatsoever with the airline industry as far as I know.

EasyJet's CEOs since they were founded in 1995:

Ray Webster (1995-2005)
Andy Harrison (2005-2010)
Carolyn McCall (2010-present)

[Edited 2012-02-21 14:11:42]

[Edited 2012-02-21 14:12:45]

WestJet747 · Wed Feb 22, 2012 2:15 am

Quoting Salmonela (Reply 7):
easyJet CEO Raj Rajaratnam was sentenced to 11 years for insider trading. Don't know how much (if any) he served.

As Viscount mentioned, Raj Rajaratnam was never the CEO of easyJet nor did he have any connection to the industry whatsoever. Mr. Rajaratnam was a hedge fund manager (he founded the now defunct Galleon Group) who wasn't very good at insider trading. A quick Google search and you should be able to find a recording of the very incriminating phone call he had with Anil Kumar that the FBI recorded.

smi0006 · Wed Feb 22, 2012 2:38 am

There were a few Qantas Group executives (Australian Nationals) jailed in Vietnam recently whilst working for Jetstar pacific. I can't recall what the charges were and if they were real, but they did spend a period in Jail.

dtw9 · Wed Feb 22, 2012 2:48 am

We also have the infamous Scot Spencer who was involved in Braniff versions 2 and 3. Mr Spencer did some time in prison for looting Braniff 3 and apparently is in trouble again.

http://www.pe.com/business/business-...cers-airport-management-to-end.ece

http://opinion.latimes.com/opinionla...orts-new-baggage-tag-code-fbi.html

Quokkas · Wed Feb 22, 2012 3:30 am

In 2008, the Australian Competition and Consumer Commission imposed a $20 million fine on Qantas for illegally price-fixing cargo shipments over a four-year period. QF's US head of freight, Bruce McCaffrey, was fined and sentenced to eight months in a US jail for being involved in the cartel.
http://www.heraldsun.com.au/news/nat...ailed/story-e6frf7l6-1111117044932

redflyer · Wed Feb 22, 2012 6:02 am

Doug Parker, CEO of US, spent a night in jail for a DUI conviction in 2007 (it was his 2nd conviction for this type of offense, the first one occurring in 1991).

PanHAM · Wed Feb 22, 2012 7:14 am

Quoting PresRDC (Reply 8):
Google "air cargo cartel."

a good example for criminalizing and convicting innocent people. A good example of how corrupt the US justice system is, when it is better and "cheaper" for managers to accept a jail sentence instead of fighting through the court for exonneration.

A good example of hwo the justice system in the US, by not understanding how an industry works, can make this injustice happen.

An air cargo rate is made u of three components.

The security fee
the fuel surcharge
the actual air cargo rate

For the first 2 components, airlines have the same suppliers, they pay more or less the same and when one carrier announces a hike or a reduction in the fuel surcharge, most other will follow suit the same day. Usually, the national carrier in a country starts that procedure.

The latter part, the actual cargo rate, is never ver fixed between the competitors. These rates are individual., they depend on how much business a freight forwarder does with a carrier, there are volumen discounts, there are special rates for particular shipments, There are so many components that rate fixing is virtually impossible and what counts is the total cargo rate, made up of the three components.

Couple of years ago, there was an air cargo conference in san Diego where the FBI served subpoenaqs. Just mentioning the word " freight rate" seemed to be a crime. I wonder how many people will attend this years TIACA conference in Atlanta. I think it is better to stay home than fall into the hands of a justic esystem that sends people to jail for non.existing "crimes".

.

TN486 · Wed Feb 22, 2012 11:00 am

In Australia, the Chairman of Southern Cross Airlines (trading as Compass Mk 2) Doug Reid was convicted in 1997 of theft and false accounting in relation to the collapse of that airline. I believe he received a 10 year jail sentence.

ridgid727 · Wed Feb 22, 2012 11:55 am

A few years back, Northwest Airlines Co-Chairman, Gary Wilson was charged and cited at the Boise airport for possession of marijuana and drug paraphanalia at the Boise airport. He posted bond, later forfeited it, but was not jailed.

http://www.nytimes.com/1994/08/07/us...man-cited-for-drug-possession.html

DALCE · Wed Feb 22, 2012 12:01 pm

I believe the CEO of Holland Excel / Air Holland Mr. Erik de Vlieger was put in jail whilst being active as CEO of the now ceased airline.

jbmitt · Wed Feb 22, 2012 12:55 pm

Quoting apodino (Reply 4):
This weeks episode of American Greed is about Tom Petters, who was CEO of the parent company of Sun Country Airlines for a few years. This parent company was Petters Group Worldwide, and it was later revealed to be a ponzi scheme, and thus Tom Petters is sitting in prison today.

If you are all interested the episode will air on CNBC Wednesday night at 10 ET.

I went to college with his son prior to him being to be killed in Italy on Spring Break. Never knew about his connection to Sun Country. Learn something new about aviation every day.

tcasalert · Wed Feb 22, 2012 1:07 pm

I'm surprised nobody has mentioned the infamous Viktor Bout? British Gulf International, Air Cess, Falcon Express, Irbis Airlines and allegedly also with links to Air Foyle, currently serving time in the US for decades of gun running into Africa and the Middle East. The Nicolas Cage film 'Lord of War' was allegedly based on Bout's life.

Braniff747SP · Wed Feb 22, 2012 2:21 pm

Well, I don't know if they went to jail, but I believe some employees, possibly management, were prosecuted in relation to AS 263.

EyeSky · Wed Feb 22, 2012 3:19 pm

Col. Lewis H. Brittin, founder of Northwest Airways as well as its vice president and general manager and later, executive vice president, served a period of 'house arrest' at a local sheriff's home in 1934 after he was found in contempt of Congress for refusing to turn over personal papers that were supposedly related to the air mail 'Spoils Conference' of 1930. Roosevelt had canceled all private air mail contracts in 1934 but after the US Army proved to be disastrously less effective at delivering the air mail than private companies, the government attempted to save face by allowing private airlines to once again bid for air mail contracts. The major stipulation to this about face being that no companies that had been previously awarded contracts from the Postmaster Brown 'Spoils' era could apply. That was when Northwest Airways turned legally into Northwest Air Lines (and American Airways becam American Air Lines, Eastern Air Transport became Eastern Air Lines and so on ...)

I think Lewis Brittin's house arrest may be the earliest example of an airline executive doing jail time.

Viscount724 · Wed Feb 22, 2012 8:55 pm

Quoting PresRDC (Reply 8):
Google "air cargo cartel."

http://www.aircargoworld.com/Air-Car...93872

Apart from those with prison sentences mentioned in that article, there were others, including QF's former VP of cargo for the Americas. He spent 6 months in prison a couple of years ago (plus a $20,000 fine).
http://www.smh.com.au/business/exqan...rice-for-cartel-20090503-arek.html

British Airwyays, SAS and Martinair executives also served prison terms related to the cargo price-fixing investigation. They're listed in this document.
http://www.mauriceblackburn.com.au/m..._air_cargo_price_fixing_cartel.pdf

lutfi · Thu Feb 23, 2012 3:43 am

There was an airline "executive" who was active on airliners.net a few years ago (Neal Robertson) who was convicted of paedophile sex, and sentenced to life in prison

JU068 · Thu Feb 23, 2012 5:51 am

CEO of Jat Airways was shot and killed in front of his home in 2000. I guess it was more or less Milosevic's version of imprisonment...

PanHAM · Thu Feb 23, 2012 6:13 am

Quoting Viscount724 (Reply 23):
Apart from those with prison sentences mentioned in that article, there were others, including QF's former VP of cargo for the Americas. He spent 6 months in prison a couple of years ago (plus a $20,000 fine).

yes, unfortunately he was dropped by QF and offered as bait to the "justice" system. The guy was innocent, he had done nothing wrong, he had no choice but to surrender and make a deal. He lost his life savings anyhow and could not have afforded to fight the case.

Luka · Thu Feb 23, 2012 9:27 am

Quoting ju068 (Reply 25):
CEO of Jat Airways was shot and killed in front of his home in 2000. I guess it was more or less Milosevic's version of imprisonment...

Yep. He spoke up against Milosevic and got killed. That was at the end of the regime when things were starting to fall apart for Milosevic and his insane wife and anyone who spoke up against him would get shot dead. Petrovic was an amazing CEO. He kept JAT flying during the 90s. Created MAT in Macedonia so Serbian pilots wouldn’t lose their license. Managed to get spare parts for planes and fuel in Timisoara despite international sanctions, created Air Srpska so Jat basically kept flying during the NATO bombing. And during this time JAT also managed to rebrand, change seats in all its aircraft, overhaul the DC10… He’s probably turning in his grave when he sees the current amateurs running the airline.

AirframeAS · Fri Feb 24, 2012 12:12 am

Quoting Braniff747SP (Reply 21):
but I believe some employees, possibly management, were prosecuted in relation to AS 263.

That is true. My former manager at AS was terminated as a result of the investigation. The guy was SEA based, how did he end up being involved with the 261 tragedy is beyond me. This crap took place in OAK, not SEA.

JU068 · Fri Feb 24, 2012 6:33 am

Quoting Luka (Reply 27):

I think he has been turning in his grave since his death since he was the last competent person to be in charge of Jat.