EZjet to wind down operations

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EZjet to wind down operations

Unread post by bimjim » Fri Dec 14, 2012

http://www.demerarawaves.com/index.php/ ... tions.html

EZjet to wind down operations
Kwesi Isles
Friday, 14 December 2012

Cash-strapped EZjet Airline is looking to wind down its operations as the fallout from embezzlement charges against owner Sonny Ramdeo continue to reverberate with no signs of potential investors in sight.

This was revealed at a news briefing on Thursday by acting CEO Rosalinda Rasul who laid the blame for the airline’s troubles squarely at the feet of now-indicted Ramdeo who is currently in custody in the US.

“EZjet was very fragmented, no one knew what was happening in the other stations, only Sonny Ramdeo the owner of the airline knew what was happening in the entire company. Only he knew the entire financial position of the company, my management and knowledge of EZjet was limited to Guyana,” the Georgetown Operations Manager said.

“We trusted Sonny and believed what he told us about the company.”

Trouble surfaced publicly with October’s lawsuit against Ramdeo by a US hospital chain which alleged that he had diverted more than US$5M from its payroll account to the airline.

Promise Healthcare and 11 of its hospitals sued Ramdeo, PayServ Tax, another of his companies, and Ez-Jet GT, in Palm Beach County Court. It claims it hired Ramdeo 8 years ago to manage payroll for its 3,500 employees in its hospitals nationwide. They stated that in the two months prior to the filing Ramdeo stole $5,387,000 from Promise by diverting its funds to EZjet.

Swift Air, the company from which the airline leased aircraft, subsequently pulled out of their deal for monies owed resulting in the US Department of Transportation suspending the carrier’s licence, a move which was followed by the Guyanese aviation authorities.

And the FBI on Wednesday arrested Ramdeo and he was charged with a US$20 million federal payroll tax fraud scheme.

“Right now where we’re at is that there are plans to wind down the operations because the owner is in the Feds custody and there’s no money in the sense of the large amount of capital that’s needed to continue this airline. With all the bad name and the disrepute that we’ve gotten regrettably the only thing left to do now is to complete the refunding process and wind down the operations of EZjet,” Rasul said.

The refunding process is now with the government after the airline failed to source cash to pay passengers.

“I only knew that something was wrong when the lawsuit hit the media … I had no prior knowledge about this lawsuit which goes back to Sonny never told us about a lot of things that were happening,” Rasul said.

She added that she met Ramdeo in early October in New York and he told her he would be out of the company for three months to handle some personal matters and wanted her to act as CEO until his return.

Rasul said she spoke to Ramdeo by telephone the day the lawsuit appeared in the media at which time he stated that he was innocent of the allegations levelled in the suit.

“I also asked him about the impact this lawsuit would have on the airline because there was a relationship there between him and the airline and he said there is no impact because the lawsuit was a separate matter because the airline was still strong and would continue as per normal,” she said.

Rasul added that a lot of financial responsibilities were subsequently placed on the Georgetown operation with them having to pay for fuel for the other EZjet operations in Trinidad, Canada and New York. It was that development that led to the financial precariousness of the Georgetown operation.

The New York staff resigned en masse while the Port-of-Spain manager resigned, Rasul said, while the Canada operation is still in place but not functioning.

She said she began looking for investors to source funding and they were on the verge of closing a deal with one when the US suspended their licence.

Rasul added that she believed Ramdeo went into hiding from the authorities and explained that phone numbers that they had for him were no longer working and the only way she communicated with him was via the internet.

Ramdeo had been issuing press releases to the media via email saying that he was in contact with the FBI.

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