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Trust and Verify

Posted on: September 1st, 2014 by Pete Agur

September CoverHow often do you audit your Business Aviation Services?
Most Business Aviation professionals are worthy of all the trust you place in them… and a very small percentage is not, observes Pete Agur.

The Director of Aviation for a large, closely held company was recently indicted for embezzling $2.7 million. It is the first time in my memory that a Business Aviation professional has been publicly exposed for alleged criminal wrong doing. Like most white collar crime, the normal course of action is usually much more private.

Few companies and owners want to publicly air their dirty laundry. As a result, the risk and frequency of such incidents is underexposed and, therefore, under appreciated. The following are examples of serious breaches of law and trust of which I have personal knowledge. To avoid further embarrassment to the victims, I have not identified companies, geography or individuals. If you think you can connect the dots, don’t bother. You may be wrong and could be assuming someone is guilty of misdeeds when it is really their evil twin on the other side of the country.

EXAMPLES OF FISCAL BREACHES OF TRUST
1. The Chief Pilot for a major company tells the aircraft salesman to include a Mercedes Coupe, by serial number only, as part of the loose equipment of the company jet or the salesman won’t get the deal.

2. The owner of a small aircraft management company uses his customer’s hangar to run an illicit aircraft parts warehouse, placing the owner at risk in a wide variety of ways.

3. The Chief Pilot for a very high-net-worth individual overbills the owner for various aviation services, with which he buys a new, exotic automobile.

4. The married Director of Aviation for a high-net-worth individual uses, without permission, the owner’s aircraft to pick up his girlfriend in a neighboring state. The direct operating costs of the flights exceed $10,000.

5. The area sales representative for a foreign aircraft manufacturer offers consultants and aviation department members a “finder’s fee” for any sales brought his way.

EXAMPLES OF PHYSICAL BREACHES OF TRUST
1. The First Officer for a closely held company tells the executive responsible for aviation services his concerns over the Chief Pilot’s high-risk behaviors. The executive tells him to take it up with the Chief Pilot. Within a few weeks, both pilots are killed, along with several top executives, in a pilot-induced accident.

2. The Chief Pilot for a small company developed a vision problem in one eye. He told neither his employer nor the FAA of the malady. He walks away from a crash in his personal airplane caused by his impaired depth perception and hides the wreckage in his personal hangar. He then has a hard landing in the company jet.

3. A helicopter charter company operates and maintains its customers’ aircraft. The service provider has a fatal accident. The NTSB investigation finds the probable cause to be maintenance-related. The operator continues to advertise on its web page an accident-free history and tells potential customers the NTSB got it wrong.

4. During the background check of an apparently excellent candidate for the position of Aviation Director, a newspaper article chronicling the individual’s arrest for rape is discovered. The article reported he had gotten a flight attendant drunk, and it went downhill from there. Somehow the charges were dropped.

5. An entrepreneur hires a slick-talking and under-experienced operator to fly his large personal jet. For years the aircraft takes off from the home mountain airport too heavy to assure an engine-out departure. There is an elementary school at the base of the hill at the end of the runway.

CONFIDENCE IN PERSPECTIVE
These examples are only a few of the dozens of which I am aware. My friend, Jeff Baker, Ph.D. is a clinical psychologist. Jeff specializes in abnormal (criminal) behavior. He says about one-in-thirty males engages in antisocial activities. It is possible that professional aviators have a higher incidence, since one marker for these folks is “his/her dynamic confidence”.

If there is one behavioral characteristic we all want in our surgeons and pilots, it is confidence. On the other hand, if that confidence is oriented by a skewed moral compass, the results can be surprising and most unfortunate. In my reflection on the cases I have witnessed, many transgressors had two behavioral characteristics in common:

1. The offenders often emulated Eddy Haskell of Leave it to Beaver fame. They behaved well around adults, but their divergent true selves emerged amongst their peers.

2. They really did have an over-abundance of confidence— so much so that descriptors like arrogant, egotistical and over-confident applied in abundance.

It is highly likely your Business Aviation professionals deserve your trust and confidence. So do your accounting and finance professionals. How often do you have your company’s books audited? Who selects the auditor? Are the auditors’ findings taken seriously? Then why would you not use the same standards for your Business Aviation service providers? In other words: Trust and Verify.

by Pete Agur

Published by World Aircraft Sales, September 2014


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