![]() Student Manoj Rajput, left, checks with instructor Justin Olsen of CRM Aviation Training Center, where Rajput is receiving his flight training now. Greg Bryan / Arizona Daily Star
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Sierra Tucson Eating Disorders Program Coordinator Trades/Construction RANCHO RESORT MAINTANANCE POSITION General A1 Communications Cable Techs BusinessStudent pilots demand refunds, say local schools shorted themOne facility reduced training flights, they say; another folded
Arizona Daily Star
Tucson, Arizona | Published: 02.10.2008
About 9,000 miles separated Manoj Rajput from a pilot's license and a shot at leaving behind his parents' electronics store in India. The chance to change his life began with a Tucson company's remarkable offer: spend six to 10 months studying at Ryan Airfield and leave as a certified aviator.
Rajput said he and nine compatriots scraped together thousands to pay the International Airline Training Academy — known as IATA — for classroom training and hands-on flying experience. But as last summer approached, the students became suspicious when they said their flight training was just two days per week, far short of the six days they said they were promised.
Finally, the group left the Tucson school for another in Scottsdale, claiming it is owed more than $130,000 for incomplete training.
"America is known for the opportunities it provides," said Rajput, 33. "When I see this, it really is discouraging."
Flight schools have been under pressure to closely monitor their students since the Sept. 11, 2001, terrorist attacks. But some students and experts say it is the schools that need closer monitoring.
While the Federal Aviation Administration monitors the curriculum and air-safety standards of flight schools, there is little oversight of the financial health of those institutions, interviews suggest. Instead, students are left to fend for themselves in the American legal system — something more than 100 Tucson students are facing after the collapse of a helicopter school last week.
About 130 local students had their training suddenly ended — and some lost significant money — when Silver State Helicopters, which operated at Tucson International Airport, closed and filed for bankruptcy. Many became creditors in the case.
The Indian students also are becoming entwined in the U.S. legal system after trying to talk to IATA's owners personally — and having the police called on them. Their attorney said they are mulling a possible lawsuit against IATA over expected tuition refunds.
The school's attorney, Mark L. Collins, said in an e-mail that the school is one of many experiencing shortages of flight instructors and is planning to refund less than $110,000 of the Indian students' money.
"When problems occur at flight schools, particularly big flight schools, it really does tarnish the image of all flight schools in the United States," said Rand Goldstein, the president of Wright Flyers Aviation Inc. in San Antonio. "Unfortunately, we suffer with the reputations of the few that ruin it."
When trouble began
IATA's financial troubles may not have begun with the Indian students, Pima County Superior Court records indicate. The school has been sued twice in the last two years over finances, including a major bank's assertion that IATA owes it more than $1 million.
In late October, Bank of America sued IATA, claiming that the school owed about $101,000 on a promissory note and $910,000 in loans as of Oct. 19, not counting interest. Owners Jean-Marc and Teresa Eloy took out the loans in July and September 2005, documents stated.
Collins, their attorney, said the dispute was over the financing of buildings bought by IATA, but that the school was never late on payments and is refinancing the buildings through another lender.
In June 2006, a Pinal County man filed suit against the school, saying IATA owed him $17,320 in exchange for providing 1,000 hours of flying time on his Beechcraft King Air 90 aircraft. IATA eventually settled the suit, awarding the plane's owner, David Reid, $4,000.
IATA trains hundreds of pilots per year at its Ryan Airfield facility, 6400 S. Aviator Lane. The vast majority, 88 percent, are Chinese, Collins said, and about 10 percent are Indian. The FAA lists the school as "certified," which means it can train international students and advertise such training.
The school moved operations to Ryan in May 2003 from Glendale Municipal Airport, purchasing the building and planes from KLM and leasing the land from the Tucson Airport Authority.
Chinese students, the school told the Arizona Daily Star in 2003, receive customized 10-month training "from the ground up" — from ground school lessons in aviation theory, plane mechanics and flight preparation to flight lessons in single-engine and multi-engine planes, and finally jets.
But to the Indian students, it seemed as if excuses, not courses, became the norm. One said he once overslept and then was barred from taking to the skies for almost two weeks. IATA promised enough instructors to sustain a 24-week course and six-day-a-week training, they said.
"After three to four months, it was just getting slow," said one student, Biju Chandran, 26. Besides the pace of training, there were few unused planes, available instructors or aircraft with completed maintenance, according to documents from their attorney.
International students are attracted to flight school in the United States for many reasons, Goldstein said. "We have a large country that has open skies for training compared to many countries, and the ability to put many planes out in training missions is a little easier."
But foreign students also are vulnerable because they make big outlays of money for their training and have little knowledge of their options if things go wrong, experts said. They also are on student visas that limit their time in the country.
Silver State closure
When Silver State Helicopters filed for Chapter 7 bankruptcy last week, it left questions for hundreds of students in Tucson and Phoenix who still have flight training left, many of whom are out thousands of dollars each.
Silver State said in a statement that it closed last Sunday because of a "rapid, unprecedented downturn in the U.S. credit markets" that "severely curtailed" the availability of student loans.
"We weren't even told that they were going to be filing for bankruptcy," said Loren Kierstead, a Silver State student in Tucson. "There's really nothing that we can do."
A Silver State spokeswoman did not return phone calls seeking comment.
U.S. Bankruptcy Court filings show that Silver State has $50,000 or less in assets but between $10 million and $50 million in debt. At least 100 people or businesses in the Tucson area are listed as creditors, bankruptcy documents state, and more than 6,000 total are owed money.
"For a lot of people, this has been their lifelong dream," said Rene Durazo, another Tucson student who lost money.
Airport Authority officials said the authority's leases with flight schools are simply real estate transactions. They added that the airport does not oversee the schools aside from enforcing some guidelines set out by both it and the FAA.
Post-9/11 scrutiny
Arizona flight schools landed in the spotlight after the Sept. 11, 2001, attacks. Islamic extremists such as Hani Hanjour were drawn to Arizona by the flight schools. Hanjour, who piloted American Airlines 77 into the Pentagon, also lived in Tucson and attended the University of Arizona.
Scrutiny of international students has risen since Sept. 11. In fact, when Teresa Eloy, the IATA official, was asked about the Indian students who were complaining about her school, she told a reporter to check with the FBI regarding an investigation of the students. But Manuel Johnson, an FBI spokesman in Phoenix, said a probe in November into a group of Indian students at IATA revealed no signs of terrorism. He would not say who made the complaint.
Local authorities also became involved in the matter when some of the Indian students showed up at IATA on Jan. 25 to ask about their refund payments. A Tucson Airport Authority police spokesman said the company complained when "irate" students showed up, but no arrests were made.
"Why is it trespassing if it's their money?" said Donald Maxwell, the Indian students' Scottsdale attorney.
The students have since returned to the Phoenix area, where they are finishing their training at CRM Aviation Training Center. Instead of the couple of days per week they had at IATA, they're now up in the skies almost every day, owner Paul Blair said.
But some in the industry have harsher words for alleged malfeasance and say that trouble with a handful of flight schools can make all institutions look bad — and leave some students, such as the Indians, waiting for their money.
"This is a huge burden for them," Blair said. The remaining students at his school, he said, "have had to practically beg, borrow and steal."
● Contact reporter Jack Gillum at 573-4178 or jgillum@azstarnet.com.
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