The scheme and similar schemes were reported to the serious fraud office late last year and separately to employment solicitors.
With respect, I doubt that the SFO will be interested, nor should they be. The schemes were, I am told, cleared in advance with HMRC who approved them at a local level, particularly with respect to the VAT treatment.
In brief, the payment from the candidate (or his bank) to the one of the training provider's companies is called a bond payment so that it is in effect a loan from the candidate to the company, and therefore not subject to VAT. The company then uses the cash to purchase the flight training internally (inter company transaction, all VAT reclaimed). The 'bond' is then sold to the employing airline (which must be UK based) the airline then 'repays' the bond to the candidate over a period rather than paying part of his/her salary.
Gin & Tonics all round, the flight school effectively doesn't charge VAT on its fees (unlike everybody else), the airline employer looks like a jolly good egg and the candidate may actually believe he is getting flight training for free.