Only chance of recovery of the student’s fees from ASA is……………….

Hello ASA students,

First off, I’d like to express my sincere sympathy for those students stranded by the recent ASA fiasco and wish you all the early arrival of meaningful assistance to alleviate the current enduring hardship. I have no personal stake in this ordeal and neither lost nor gained anything from this occurrence. Nevertheless I can’t stop being indignant about both Prince and Reny of their incompetence and deceit whichever the characterization is appropriate that brought to cause a current plight onto those young aspiring Indian students.

In as much as I’d like to believe that Prince and Reny stashed away a sizable amount of cash somewhere as some still like to speculate or believe and therefore there’s some chance of recovery of their prepaid fees, it pains me to tell you all such chances to exist is literally infinitesimal if not nonexistent.

I know it’s easier said than done but give it a rest on a hope of recovery by a means of law suit. In the Breach of Contract case such as this, you will most likely prevail in the court and obtain a judgment. But think about it, what good is it that the judgment that can collect nothing from the defaulting party. A writ of execution issued from the court is just a useless paper of no value. Remember no one wins in a law suit except lawyers. (been there, done that, fought an airport use permit issue against a county ordinance in the US Federal Court and won the battle but lost the war in the end after consuming 3 years and $150K in legal fees, .a Pyrrhic victory indeed.

Judging from the reported size of operation,(110 students, 43 instructors, 40 aircraft) the monthly operating cost could be anywhere from $225k to $250k/mo. or more to keep that size of operation going. Remember ASA did not have $4.4 mil in a lump sum cash to start with. It’s an accumulative total revenue over the time they were in business. Unless they had an sufficient operating capital set aside which I doubt, their monthly operating expenses were entirely relied on one source; student fees. There’re good months with some surplus fund left and there’re some bad months with an insufficient amount of income even to cover the monthly overhead. It’s highly probable that ASA needed at minimum 4 to 5 new students to keep its doors open. All fees collected from the students were all spent long since and I bet they’re just scraping by from month to month with a hope of someday getting ahead with an arrival of new enrollment group consisting of substantial number of students. Unfortunately, that day never came and the KFA fallout was the last straw. And while they were still at it, the problems started to pile up one after another. It probably started with a minor student’s complain and then rapidly growing to many issues that eventually raised red flags and invited all kinds of government scrutinies from all directions FAA, County’s office, IRS, FTA (Calif. State Franchise Tax Board) and all. Despite less than honorable character references made about both Prince and Reny in many posts, I doubt they had planned this outcome from the beginning. It’s a case of pure incompetence and mismanagement. They had somehow managed to slip their foot in the door and pried open the business opportunity just in time to ride the surging tide of pilot shortages beginning to be faced by the Indian airlines.

Some of you already know about another flight school closure earlier this year which draws some parallels to the events at ASA in the order of far greater magnitude.

http://en.wikipedia.org/wiki/Silver_State_Helicopters

Silver State Helicopter (SSH) school headquartered in Las Vegas closed abruptly by filing Chapter 7 leaving 2,500 students out to the street. They operated over 250 helicopters at over 40 schools nationwide in the US. All students prepaid $70,000 each for their training fees. A Class action suit is pending in the Nevada Court and the lawyers are having field days. Good lawyers can compose an opposing lawyer’s argument before composing his own and they are very good and capable indeed and naturally they command high fees most can’t afford.

The only chance of recovery of the student’s fees from ASA is by naming KFA along with banks and lending institutions as co-defendant on the premise that they too are culpable for the damages sustained by those entrusting students. Their failure to perform proper audit and due diligence on the flight school led to the demise of the program today otherwise succeeded. This premise has a much greater chance of succeeding and the judgement amount of $5 mil range plus legal expenses has far more chances of collection from KFA and the Indian lending institutions involved than nonexistent collection probability from the duo Prince and Reny.

Now sit tight and think hard about the good advices offered in the Capt. Kishore’s post and begin to make a check list of your own action plan and proceed to follow thru on it one by one. BTW, make sure to insist on a kind of insurance policy like the one mentioned in the navdeev’s post if you’re fortunate enough to take out another loan again.

Before too long, you’ll be out of the soup and turbulence and you’ll be back cruising in the smooth blue skies again. How do I know this? Well I went through the similar ordeals few times myself since my first arrival in the US in 1968 from Asia and got my ATP, A&P, MEI, AD and few more ratings and pursued my aviation career until my semi-retirement from flight duties few years ago. Well, that’s my two cents. Hang tight and never ever give up your goal.
All the best.

Echo Yankee, Real identity not revealed……

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Recovery may not be possible if Prince & Reny file for Bankruptcy under Chapter 7 of the Federal Law, feels Capt C Kishore

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Capt C Kishore, Director, Arrow Aviation Solutions writes

Dear ASA Students,

At the outset I am sure those who took the Psychometric test under me for the ASA-KFA program, would remember me and my steadfast criticism of students who did not perform well. Anyways, we had severed ties with ASA after they did not renew the contract with us and inspite of that on personal requests from Hasher Khan, Reny and also their Indian Representatives (Study Abroad), I continued doing tests for 3 more months. Later realized that I was being conned and would never get paid for the tests done on the pretext that I had not released results… that’s obvious, why should I release the results unless we are assured of being paid for our services. Repeated phone calls to Hasher/Reny/Sergio yielded no result and when I did a bit of research I was sure that ASA would shut down sooner than later and I had predicted this as early as Nov’2007 after the KFA fall out. In fact I had advised a few students who were in touch with me to get out before it is too late. I was told by these students that Prince has threatened not to return the money if anyone leaves.

Just some food for thought from my visit to Atwater from 4th July to 9th July’2008. I went there on request of few parents and Study Abroad, Chennai to help students secure transfers to better flight schools and also organize a good attorney to file a law suit. Firstly my observation was that there are far too many groups of students and each group with their personal agenda on how to solve the situation, unfortunately I found most of the groups far too immature in their actions as well as long term objectives, it appeared as if they had lost focus on why they had gone to USA. I do not blame them considering the trauma they would have undergone after being evicted from the barracks and realizing that their flying dream has crash landed.

1. As Bhavna brought out, Who is “Prince”? if you just go back a few years behind you will realise that apparently he started out as a Flight Instructor in Amritsar Flying School, Punjab, where there are unconfirmed reports that he was involved in cases of fraud following which he fled to USA/Canada.

2. Can Kingfisher be indemnified from the whole scene as they play a major role in the whole deal, most of the kids joined ASA because of the KFA (Kingfisher Airlines) tie up, inspite of knowing that they were going to pay more than other flight schools. The fact lies that ASA continued to use the KFA tie up to lure new students even after the fall out. How come KFA never did a audit on a flight school they endorsed for their cadet program? Which should have been a mandatory practise in view of KFA allowing ASA to use their logo for co-branding…. this beats me totally… unless Prince had been paying KFA officials responsible for such an audit.

3. $4.4 million and counting, I am not a great finance expert, but being a Pilot and an aviation consultant with thorough knowledge on what goes into running a flight school from fuel, maintenance, aircraft lease, spares, landing charges,etc etc….I can safely say that it is next to impossible to expend such a large amount of money in such a short period of time. Well the finance experts might want to prove me wrong by putting pen to paper, yet they would fail miserably. I visited the ASA ramp in Atwater, personally and saw that there were hardly 7 or 8 airplanes on the ramp, wonder whatever happened to the 40 odd aircraft if they were actually owned by ASA. Well if they were on lease then on what did Reny/ Prince spend money on.

4. I am sorry to say but, after extensive talks with various Attorneys I can say that recovery of the money of all the students may not be possible if they file for Bankruptcy under Chapter 7 of the Federal Law, but still a lot depends on discovery of assets within the USA to recover the money. Knowing Prince and Reny, I am sure there is no money in USA coz I don’t think either of them is so foolish to have assets in USA and are waiting for those assets to be attached through a Court injunction. Yes, sending them behind bars maybe a probable proposition, even though it is too early to say that. So, basically there are far too many variables and let us all accept the fact that no miraculous recovery of fees paid is going to happen overnight.

5. I was told that the Indian Embassy in SFO has provided 2 attorneys who are willing to fight the law suit against ASA, without any money being paid upfront and want 40% of the money recovered as attorney fees, which I feel is ridiculous. I wonder what the hell is the Indian Embassy doing, are they trying to get the students be duped of their rightful claim of damages for what they have undergone. I would rather pay the attorney his fees and enjoy the money he recovers as damages. Because if there is money to be recovered from assets then I might as well as recover my complete money. How do we know whether there is money to be recovered, well that can only be ascertained through a thorough investigation by a competent financial investigator. Please keep in mind that this is a huge lawsuit and the claim for damages can amount to as high as $5 million upwards. even that might be an understatement. So just tread the road ahead with caution, those offering help may not actually be a knight in shining Armour.

As they always say advise is always free, whether you take it or leave it is your choice…. so here goes my two pence on this issue to all of you ASA students.

1. Those with funds crunch right now, try and organize funds enough to fund your Private at least, get your PPL and head back to India, put your head down and study, clear your DGCA papers and then re assess your finances and try and get into Indigo or Air India Express cadet program, which shall at least assure you a job in the current volatile market.

2. Those who can afford to complete their training and are not a part of the KFA cadet program, you better think about getting yourself a CFI and work towards time building before getting back to India, try getting add-on ratings on King Air B200 or a Citation CJ2, so that the chances of your enjoyability increase in Corporate sector.

3. Along with your CPL get yourself an Aviation Management Diploma from Embry Riddle Aeronautical University so that you can get placement in Airline Operations while you slowly work your way back towards the flight deck.

I wish you guys all the best in all your future endeavors and all of you are most welcome to mail me at kishore@arrowaviationsolutions.com.

Happy Landings

Capt C Kishore   Director, Arrow Aviation Solutions

Kingfisher came inch closer to buying SpiceJet

Kingfisher Airlines is close to acquiring a controlling stake in another low-cost carrier SpiceJet.

The deal will value SpiceJet around $300 million dollars. It is likely to be a cash-and- share swap deal.

Mallya is likely to acquire 26% stake in SpiceJet, and make an open offer for an additional 20% stake. He is also likely to retain Spice as the low-cost carrier of Kingfisher Airlines

If the deal goes through, Mallya, through Kingfisher Airlines, Deccan and Spice, will control 40% market share beating Jet (along with Sahara), which has a market share of 33%.

It will also give Mallya the position to dominate fares in the marketplace. Currently, because of the low cost airline fares, Kingfisher and Jet are forced to sell tickets below cost.

SpiceJet is a fairly well run, lean operation with the smallest loss in the industry. Experts say it will give Kingfisher the right product in the low cost space. And, of course, access to trained manpower.

What may not work too well for the two airlines is the fact that they operate different fleets. Spice flies Boeing while Kingfisher is an Airbus customer. So, there are no clear synergies in operations. Analysts say if the two airlines continue to function separately, it will not pose a big challenge for Mallya.

If the deal does fructify, it could change the aviation landscape in the country and make the airline industry more viable.

California ‘Prince’ dupes aspiring pilots. Students evicted from their accommodation.


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This is a follow up of my last post, More than 100 Indian Students Stranded in USA due to Aviation School shutdown.The students, who shelled out about $40,000 each in the hope of finding jobs as pilots in India’s booming civil aviation industry, were evicted from their accommodation yesterday after officials in Merced County — where the school is located — pleaded their inability to continue water and electricity supplies to the building unless the school settled outstanding utility bills. Students, predominantly here on visas from India, learned of the pending action from notices posted on their doors at Castle Commerce Center by Merced County officials Wednesday morning. They immediately reacted with anger and disillusionment. Later in the day, a group of about 40 students formed in the apartment’s hallway, shouting and talking over each other. Officials of the Indian consulate general in San Francisco, who rushed to Merced County in response to pleas from the students, negotiated with local officials who agreed on Thursday to allow the students to stay in their accommodations for 30 more days if they shelled out $7,000 in part payment of outstanding utility bills. The students said they initially agreed to the offer, but later went back on it after a consensus that they saw little point in throwing good money after bad and that it was better to cut their already substantial losses. About 30 of the students have taken up an offer from “Prince” Singh, who runs the school’s day-to-day affairs, to have them enrolled in another flying school in California. They left with Singh for Sacramento yesterday, but the remaining 70-plus Indian students turned down the offer ostensibly because they have no faith in him after their bitter experience with his American School of Aviation. In addition to the Indians, Japanese, Sri Lankans and even American students are in the same boat. “Prince” Singh, whose real name is Manpreet Singh, has been described in the local media as the husband of Reny Kozman, vice-president of the American School of Aviation. Reny Kozman, the vice president of the school, answered my phone call, but declined to respond to questions about the bill and then hung up. ASA also is being sued for $52,000 in unpaid fuel bills and has numerous former students trying to get tuition refunds. Kozman and her husband, Manpreet Singh, have said that they are trying to sell the business to save it from going bankrupt. Efforts to verify Singh’s current nationality or immigration status in the US were unsuccessful. The school’s website displays logos of Air India, Indian, Jet Airways, IndiGo, Spicejet and Kingfisher Airlines, among others, giving the impression that these airlines in India have an association with the American School of Aviation but at the bottom it is cleverly mentioned that “by displaying these registered trademarks and service marks, does not imply any affiliation with these airlines nor implies that graduation from American School of Aviation guarantees employment by these airlines. Past results are not indicative of future performance.”

Each student has a story to tell about coming to American School of Aviation to fulfill their dreams. Each one appears to be ending the same way. The majority of them came to the school from India and paid about $41,000 in tuition to get a commercial pilot certification. Some relied on rich parents, others saved and the rest took out bank loans.

More than 100 Indian Students Stranded in USA due to Aviation School shutdown


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A file photo of Flight Instructors of American School of Aviation, Atwater, CABreaking news is coming from California this hour where more than 100 Indian students training to be pilots have been left stranded after their Aviation Academy (American School of Aviation) abruptly shut-down. One of the student emailed me last night with all the details. The students have been served with an eviction notice and asked to vacate the Academy premises by Friday (June 27).

The students were part of a Commercial Pilot Training Programme, jointly run by Kingfisher Airlines and American School of Aviation or ASA. Students claimed they paid 46,000 dollars for the programme.

Following which the students were handed a letter of intent by Kingfisher Airlines in India offering them jobs as co-pilots on completing training with ASA and getting their CPL (Commercial Pilot License) License and subsequent conversion from the DGCA India (Directorate General of Civil Aviation).

However, the school suddenly suspended its flight training last month, claiming their school was being restructured. Students were later told the school had been shut down for defaulting in payments over fuel and insurance bills.

Email further said, “We are students of the American school of Aviation. Our school has been closed for the past six weeks. The management has tried to keep us satisfied by telling us there is a deal going through in order to get the school brought over. But now it turns out none of it is true. They have been just keeping us on hold and today issued a notice telling us to evacuate the academy in the next two days due to the non payment of water and electricity bills.”

A disheartened Dmello (Indian Student) added, “There have been a lot of false promises and we are helpless and have no where to go. We are looking forward to external support from the Indian Embassy and the Indian government. We spoke to Kingfisher and they said that they are looking into the case and are trying their level best to resolve issues.”