IAA: Pilot college financing like a Ponzi scheme
Irish Examiner
By Claire O’Sullivan
Thursday, October 25, 2012
The Irish Aviation Authority has likened the financing of the ill-fated Pilot Training College in Waterford to a Ponzi scheme, and said the director of corporate enforcement should investigate the company’s collapse.
The authority’s director of safety regulation, Kevin Humphreys, yesterday told the Oireachtas transport committee the "absence of cadet sponsorship by airlines" has meant private pilot training is "open to this kind of abuse, that is operating as a
Ponzi scheme", as huge injections of finance were regularly required to ensure quality training.
He lamented the lack of airline-sponsored cadetships, such as those previously offered by Aer Lingus and the air corps, describing it as "a lacuna".
IAA chief executive Eamonn Brennan was criticised by TDs and senators, who accused the body of failing to better regulate the school, but the IAA refused to take the blame, saying it is only responsible for safety regulation and that questions on the financing of the company should "go to the director of corporate enforcement".
Senator Denis O’Donovan took aim at Transport Minister Leo Varadkar for his failure "to take control" in the past four months and "find out where the buck lies".
It was agreed that a committee of the Dáil and Seanad will undertake a "full and forensic" investigation of the collapse of the college, which left up to 190 private and partially sponsored students out of pocket by up to €5.5m.
Mr Brennan said the
directors of the company should be brought before the committee. "The one people not being called to account are the
directors of this company," he said. "The minute this happened,
they headed for the hills. We could not contact them.
They have not been held to account and we are going around in circles here with the department and IAA."
Fine Gael TD Joe O’Reilly was sharply critical of the college going into liquidation on Oct 2, and then a day later, its
chief executive and
directors setting up another aviation company,
Clearsky.
"It was the reincarnation of a sick, old animal," he said.
Mr Brennan said the IAA will "keep
Clearsky under observation".
The IAA and the department were repeatedly criticised for failing to reimburse and compensate
students.
Mr Humphreys defended the IAA’s actions, saying it sent inspectors to
Florida when the course first collapsed, repatriated trainee pilots, seized their training records from the college, and helped students out in any way it could.
He said inspectors also met with Weston National Flight Centre and Atlantic Flight Training Academy in Cork to develop packages to assist former trainees of the Waterford college.
This story appeared in the printed version of the Irish Examiner Thursday, October 25, 2012