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This Failed Airline Stole From Passengers on Its Way Down

This Failed Airline Stole From Passengers on Its Way Down
Jackie Reddy

The former VP of Direct Air – as well as a host of other executives at the now defunct airline – have received convictions from the federal government. Kay Ellison has been sentenced to almost eight years in prison and will pay millions in restitution for her part in a scheme to defraud customers.

The former vice president of Direct Air, which collapsed suddenly back in 2012, has been sentenced to almost eight years in prison by the U.S. Department of Justice (DOJ)USA Today reports. The outlet states that executive Kay Ellison was convicted of multiple accounts of wire and bank fraud in late March and has been ordered to pay $19.6 million in fines.

Direct Air, a charter carrier which was based out of Myrtle Beach International Airport (MYR), suddenly ceased operations when it declared bankruptcy, leaving its travelers stranded without warning.

Ellison, however, isn’t the only one of Direct Air’s executives to have faced criminal charges. The outlet also reports that Judy Tull, the airline’s former CEO, and Robert Keilman, Direct Air’s former chief financial officer, have also received convictions.

In a statement by the DOJ, “…from October 2007 through March 2012, Ellison and Tull engaged in a scheme to steal passengers’ money for future travel from an escrow account by artificially inflating the amount of money that the defendants claimed they were entitled to receive, and by sending this falsified amount in a letter to the escrow bank telling the escrow bank to release the money. The evidence further established that to cover up their fraud, the defendants falsified profit and loss statements to make the company look like it was making money rather than losing money, and sent these falsified documents to credit card companies and banks to trick them into continuing to do business with the company.”

Offering his comments on the case, Assistant Attorney General Benczkowski said, “Kay Ellison stole tens of millions of dollars of passenger money in a brazen scheme that put a veneer of success on a failing company, and left others holding the bag—until today. Her sentence sends a powerful deterrent message—especially to corporate executives—and demonstrates the commitment of the Criminal Division and its law enforcement partners to uncovering and vigorously prosecuting corporate fraud wherever it is found.”

[Photo: Shutterstock]

View Comments (3)


  1. ND76

    December 4, 2018 at 4:43 pm

    You don’t receive a conviction from the federal government. You are convicted by a federal petit jury consisting of twelve citizens. You receive a sentence from a federal judge as a result of the guilty verdicts returned by the jury.

    Also, the writer of the article was quite sloppy in reporting the facts. The writer could search federal court cases by using the PACER system, where records from all federal court proceedings in the district courts and circuit courts of appeal can be found. The writer then would not have to speculate whether facts contained in another news article are correct; the writer could see the judgment of the court and the sentence for himself or herself.

  2. alexmyboy

    December 7, 2018 at 7:38 am

    future trump employee

  3. Pete92833

    December 7, 2018 at 3:10 pm

    OK, 8+ years after the fact for the convictions.

    How is that a strong deterrent?

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