Cites Downturn In US Credit Markets

The other shoe has dropped for Silver State Helicopters. Late Monday evening, the Las Vegas, NV-based helicopter training and charter operation announced it has filed a petition with the US Bankruptcy Court for relief under Chapter 7 of the bankruptcy code. 

Confirming earlier statements made to ANN by a variety of sources, SSH closed all operations Sunday, February 3, 2008, at 5:33 pm PST. In a release posted on its website, Silver State blamed the action on a "rapid, unprecedented downturn in the US credit markets, which severely curtailed the availability of student loans for the company’s flight academy students and resulted in a sharp and sudden downturn in new student enrollment."

"The decision to shut down operations was made only after the company explored its other available alternatives," said company spokesperson Elizabeth Trosper. "Information for former employees and students will be disseminated as it becomes available."

Silver State Helicopters was, at best, a troubled operation. With some 40+ facilities around the US, it reportedly operated well over 200 helicopters, and employed 850 people. Criticized by several parties -- including current and former students -- for an aggressive marketing program they claimed oversold the availability of jobs in the helicopter industry, the company was beset by a number of legal problems as students and clients reportedly sued with claims they had been deceived.

SSH actively promoted its training operation, often encouraging students to take on loans to cover the cost of rotary-wing training... which the company claimed could be achieved in 12-18 months, working around a student's work schedule, followed by promises of high paying jobs that many industry experts said didn't exist for low-time pilots.

In 2006, a Silver State Helicopters student in Arizona joined nine others in a lawsuit against the company, alleging false advertising. "I thought I'd be making this high-paying pilot job. Instead, I'm going to be in a world of hurt, financially," said Joe Hinton, a paralegal for the Maricopa County attorney. "It wasn't anything like this intensive flying every day program they promised. It's a load of crap."

ANN Editor-In-Chief Note: With Silver State's decision to enter liquidation, many parties involved in the business will take a considerable financial hit... including those students. As we currently understand the situation, many of the students, whose training may be woefully incomplete, may be required to make good for their entire loan amounts... and there are questions as to whether there is any significant protection for them if that is true. A number of legal experts have contacted ANN throughout the day recommending that affected parties contact their State Attorney General's office ASAP, as well as the US Atty General, to file complaints.

ANN had started looking into SSH several weeks ago and was in the process of researching a story when this matter went wrong. We uncovered dozens of alleged and highly questionable actions, issues and practices that impacted the safety and well-being of a great number of people. ANN feels it imperative that the Federal authorities who oversee the student loan programs Silver State utilized as part of their business plan undertake aggressive investigations into this matter. Numerous credible allegations of fraud have been made and thousands of students, staff and creditors stand to take on extensive damages as a result of what occurred here. This story simply raises WAY too many questions for their not to be a serious investigation. -- Jim Campbell, ANN E-I-C.

FMI: www.silverstatehelicopters.com