Former Flying Tigers Official Sentenced in Fraud Case

 - June 4, 2014, 12:55 PM

The U.S. District Court for Philadelphia has sentenced Joel Stout, of Elizabethtown, Pa., to 60 months probation and 60 hours of community service. Stout, an A&P mechanic and former employee of Flying Tigers, previously pleaded guilty to criminal charges related to his participation in a complex fraud involving unauthorized aircraft inspections.

Joel Stout’s father, Jay Stout, the president of Flying Tigers, was convicted of numerous counts after a nine-day jury trial in Philadelphia. Joel Stout provided substantial cooperation to the prosecution and testified at the trial on the government’s behalf. The elder Stout, formerly of Elizabethtown, was found guilty of eight counts of wrongdoing: conspiracy, three counts of fraud involving aircraft parts, two counts of mail fraud and two counts of obstruction of justice. He was found not guilty of three counts of mail fraud and three counts of wire fraud. Sentencing is set for July 18 before U.S. District Judge Harvey Bartle III, who presided at the trial.

AIN has followed the story, which began in August 2012 with the Philadelphia U.S. Attorney’s Office indicting Flying Tigers of Lancaster, Pa.; its president, Jay Stout; and his son, Joel Stout, with various crimes, including conspiracy, fraud involving aircraft parts, wire fraud and obstruction of justice. Also indicted was Howard Gunter, a former FAA-certified mechanic and inspector, on charges of conspiracy and fraud involving aircraft parts.

The investigation revealed that in 2003 the FAA suspended Jay Stout’s authority to conduct aircraft inspections and ultimately, in 2004, revoked both his airframe and powerplant certification and his inspection authorization certification. Joel Stout, former director of operations at Flying Tigers, did not hold FAA inspection authority past March 2006. The prosecution proved that at various times between October 2003 and January 2010, Flying Tigers charged customers for the annual inspections of their aircraft despite having no certified mechanic with inspection authority.

The six-year investigation revealed that the defendants routinely altered airframe and engine logbooks and made false entries to conceal their actions. Once Jay Stout learned of the government’s investigation, he obstructed the investigation by altering aircraft logbooks to conceal the false certifications. Flying Tigers conducted more than 100 questionable inspections and repairs between 2003 and 2010 involving more than 40 aircraft.

Gunter, a former FAA inspector also charged in the scheme, recently died of natural causes before the trial.

The company is not related to the 1st American Volunteer Group known as the Flying Tigers or its namesake descendant Flying Tiger Line. (FedEx bought that company in 1989.)