Aero Continente Sold To Get Off US Blacklist

Peru's biggest airline is flying again, in spite of being blacklisted by the US government.

The reason? Aero Continente has been sold.

As airport workers threatened a nationwide strike and as South Americans flocked to Lima for the Copa Americana soccer championships, Aero Continente was grounded earlier this month because the US Treasury Department accused its founder of drug trafficking.

That put Aero Continente behind the eight-ball, unable to get insurance after its policy was cancelled.

So founder Fernando Zevallos sold the airline for $3.5 million. The new company calls itself Nuevo Continente.

Based on news of the sale, Peruvian aviation authorities "said that the company satisfactorily renewed all of its aeronautical insurance, covering eight planes," Nuevo Continente said in a news release.

US Ambassador James Curtis Struble said the Treasury Department was reviewing whether the transfer of ownership amounted to "the total separation of the company from people known to be involved in drug trafficking."

But in the meantime, Aero Continente -- rather, Nuevo Continente, is flying again, carrying up to 60-percent of Peru's air passengers to domestic and international destinations.

Expediant ownership changes are nothing new to the 47-year old Zevallos. The subject of repeated drug investigations, he transferred 80-percent of the airline's ownership to his family -- without compensation. Even now, he's on trial in Peru, charged with drug trafficking and money laundering. Along with his sister, former Aero Continente chief Lupe Zevallos, Fernando is wanted in Chile on charges of witness tampering in a money laundering case.

FMI: www.aerocontinente.com.pe