Feds Want Answers On Dealings With Stabilization Board
Five airlines confirm
they've been ordered to turn over documents related to their
dealings with the former chief of the Air Transportation
Stabilization Board between January 1, 2002, and January 31, 2004,
according to published reports.
The New York Times reports the Treasury Department's Inspector
General issued the subpoenas for all information on the arlines'
interaction with Daniel G. Montgomery, the former executive
director of the Stabilization Board. While the Times reports the
subpoenas don't indicate why Treasury wants the information, it
suggests Inspectors General usually issue such documents when
researching possible cases of fraud.
Montgomery is the only board executive mentioned in the
subpoenas. He ran the board from March, 2002 until August, 2003,
before leaving to join the financial consulting firm of Kroll,
Zolfo Cooper. The court documents don't mention his successor,
Michael Kestenbaum, by name; however, they cover the first part of
his tenure as executive director.
The subpoenas ask specifically for information on meetings,
entertainment and talk of employment between the airlines,
Montgomery and other members of the Stabilization Board.
"He wouldn't even take a Coke from anyone," an executive at one
airline told the New York paper, speaking on condition of
The Air Transportation
Stabilization Board was created in the aftermath of the 9/11 air
assaults on America. Congress authorized it to loan troubled
airlines up to $10 billion. So far, only $1.7 has been loaned
In addition to records on discussions with the board, the five
airlines under subpoena have also been told to submit any
documentation they have on meals, gifts, airline tickets, loans or
discounts given to Montgomery or any other board member.
The Times report didn't name any of the airlines ordered to
submit documents to the Treasury IG. However, United, US Airways
and America West confirm they've been served.
"America West is happy to respond and comply with the request in
a timely manner," the airline's senior vice president for public
affairs, C.A. Howlett, told Reuters.