On July 25, 2019, Michael Morisi pled guilty in U.S. District Court, Newport News, Virginia, to wire fraud and filing a false Federal income tax return. The pleas resulted from charges against Morisi of misappropriation of State and Federal funds from the Small Community Air Service Development Program (SCASDP). Morosi used those funds to guarantee a $5 million loan by Towne Bank to People Express Airlines, Inc. (PEX). Morisi also underreported his income and earnings on multiple tax returns and failed to file multiple tax returns.
Morisi is the former president of PEX which operated at the Newport News/Williamsburg International Airport. In 2014, within a month of receiving the funds from the $5 million loan, PEX had drawn down nearly the entire loan amount. PEX operated for approximately 3 months before suspending service.
DOT-OIG is conducting this investigation with the Internal Revenue Service Criminal Investigation Division and the Virginia State Police.