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Owner of Aircraft Company Ordered to Pay Fines and Restitution Totaling $613,000

On December 3, 2008, Robert A. Schlotzhauer, owner of Falcon Helicopters, Inc. (FALCON) was sentenced in U.S. District Court, Kansas City, MO, to 12 months home confinement, 24 months probation, and ordered to pay a fine of $550,000 and restitutions of $63,854. He is expected to surrender his Federal Aviation Administration Airframe and Powerplant License and Inspection Authorization Certification the end of the month. In March 2008, Mr. Schlotzhauer pled guilty to Federal charges of wire fraud and money laundering. In March 2006, Mr. Schlotzhauer, his company FALCON, and the city of Lee’s Summit, MO, were indicted on charges involving a fraudulent helicopter repair and sales scheme, including, falsification of airworthiness records and use of unapproved repair methods and aviation parts. Mr. Schlotzhauer purchased helicopters that were substantially damaged in accidents and returned two of them to service with fraudulent paperwork, then offered these helicopters for sale in interstate commerce. He was also charged with bank fraud and money laundering after receiving his customers’ payments and then tried to hide the money by transferring it from one account to another.