EZjet has no money

-don’t cash cheques, CEO advises passengers

EZjet is advising customers that it has issued with refund cheques not to attempt to encash them as it has no money available for payouts, for which the Public Works Ministry is now responsible as the suspended airline winds down its operations.

“We have the cash but we won’t be able to access it soon, so it will take time for them to have their refunds. But the money is safe. Government will put a notice in the papers asking passengers to make contact with the ministry for their refunds,” acting company CEO Rosalinda Rasul told a news conference yesterday.

Rasul said the airline was told that the money to refund passengers will be from the bond it lodged with the government, which is responsible for the process. She explained it had compiled a list of the passengers to be refunded, but it was only near the end of November that the airline realized that it was the government that was responsible for the process.

Rosalinda Rasul

She added that the airline was advised that it can refund the passengers if it wants but it would have to source that money outside of the bond. She explained while it attempted to do so and former CEO Sonny Ramdeo had committed to making funds available for refunds before the passengers were given cheques, she has been pleading with him since then to send the money so that passengers can be refunded in a timely manner but to no avail. Ramdeo was on Wednesday arrested in New York on a $4B embezzlement charge and is to be transferred to Florida for legal proceedings. (See other story on page 8) There is therefore no likelihood of him assisting the beleaguered EZjet now.

Addressing the chain of events that led to the airline’s collapse, Rasul said that Ramdeo kept everyone in the dark about EZjet’s financial position.

“We trusted Sonny with the company and only he knew the company was in trouble.  He never consulted with anyone so there could have been a plan to avoid this outcome. I only knew that something was wrong when the (embezzlement) lawsuit (by his former employer) hit the media and I only learnt the same time the entire country knew,” she explained, adding that she has not seen him since a meeting in New York, after which his telephone numbers were no longer working. She added that she kept in touch with him via Skype or chat boxes and emails.

In early October, while on a trip to Toronto, Rasul said she met with Ramdeo and during that meeting he told her that he would be out of the company for three months to take care of some personal matters and wanted her to act as CEO until he returned.

“He also told me that he resigned from his other company because he wanted to give his full time to EZjet. There was nothing solid when he appointed me as CEO because he only mentioned it,” she said. “I was only aware that I was the acting CEO when the lawsuit hit the media and Ramdeo told the media that he resigned from his position.”  The lawsuit came out one week after their last meeting in New York, she noted.

According to Rasul, she spoke with Ramdeo on the phone the same day the lawsuit became known to the public and he told her that he was innocent.  “I asked about the impact the lawsuit will have on the airline and he said there is no impact because it is a separate matter and the airline is still strong and will continue as normal… again I hold him to his words,” she said.

Rasul even stated that she told the public the airline would be fine because that was the information conveyed to her. “… We did not want the airline to go down, so we did a damage control after the lawsuit was filed. About a week after the damage control was done, a lot of financial responsibility was thrust upon the Georgetown office in paying the bills of the other offices,’’ she noted, explaining that they began to pay the bills for the other offices because they were in a high flying season but it came to a point where it became a burden. As a result, she said, “we asked Sonny why we have to pay for the other stations but got no proper response… between November 5 and 6 the Georgetown office paid US$240,000 to a fuel company.”

Even at this point of the developing situation, Rasul said she and the rest of the airline’s management were not told about its problems other than the evidence they were seeing before them.

As a result, three weeks before EZjet’s licence was suspended, she stated, she sought investors to take over the company. They were a few investors who were interested and she forwarded them to Ramdeo and at one point they were close to a hundred percent in getting one investor to take over the company. However, everything crumbled before that could have occurred, she said.

She added that she still did not give up but continued to seek investors in Canada, New York and locally because she was concerned about getting passengers to their destinations. But the lawsuit was what deterred investors, Rasul noted.

Shortly after the suspension, the entire airline staff in New York resigned and the manager in Trinidad resigned as well. In Toronto, the staff remained but they were hardly seen. She and her staff were the last men standing, Rasul told the media.  They are committed to stand with the airline in its downfall because they see themselves as having a moral responsibility to assist customers. “We were tasked with the responsibility of running a company that is no ours because Ramdeo was out of the picture and we had to decide how to clean up this mess when they was no information,” she added.

A week after EZjet’s suspension Rasul and her staff went to the New York office to do some groundwork and an audit of the office to see what went wrong and what was responsible for the suspension.  “We went there but could not do anything much because we were locked out of our reservation system that has all passengers’ information because they did not pay the bills on time,” she explained.

Something deeper
With Ramdeo now in the custody of the FBI, Rasul said the airline is now winding down its operations.  If FBI investigators come to Guyana, she added, she would be very open about the airline’s Georgetown operations because it was transparent.

She said EZjet did not go down because of the problems experienced by other carriers. “Mismanagement was only a contributing factor but there is something deeper that caused the airline to go down and only time will tell what that is,” she said.

Rasul also noted that her staff took all the abuse and insults from passengers who went for their refunds while the person who is responsible for it got out completely. She added that she felt like Ramdeo used her as his whipping girl and she felt as if she was deceived by him. When asked about why she did not resign when the situation developed, Rasul said that she wanted to but she wanted to see the process conclude before.

Angry EZjet passengers have been turning up at the airline’s office for the refunds only to be told that no money was available to pay them. EZjet had said that two-thirds of the passengers left in the lurch by the suspension of its air service have been refunded and only US$190,000 is outstanding.

The airline was forced to cancel flights after the United States Department of Transportation (DOT) on November 8, 2012 suspended its operations, leading to the Government of Guyana through the Guyana Civil Aviation Authority to follow suit. The DOT’s move came days after Ramdeo’s former employer had filed an embezzlement lawsuit against him.

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