Federal agencies in India have ordered an investigation into Jet Airways. This investigation will investigate potential malpractices and fraud conducted at Jet Airways. This news comes amid insolvency proceedings against the carrier.
CH-Aviation reports that the Indian Ministry of Corporate Affairs is pushing for this investigation. The Serious Fraud Investigation Office (SFIO) will carry the investigation out. Under this process, the SFIO will also look into malpractice at Jet’s subsidiaries. This includes their frequent flier program, JetPrivilege.
What is the SFIO investigating?
In the six-month, urgent investigation, the SFIO will look for the following things:
- Siphoning and diversion of funds
- Financial irregularities
There were already reports of malpractice and mismanagement at Jet Airways. However, this investigation marks a significant turn of events as the government is now taking these claims very seriously.
In addition to the SFIO probe, both tax authorities and the Ministry of Finance Enforcement Directorate are also investigating malpractice at Jet Airways. It is unclear if these investigations are closely related. Nor do we know if they will reach similar conclusions.
One of the key players in this investigation is the family tied to Jet Airways. Anita and Naresh Goyal have been involved with the carrier for many years. Naresh Goyal, the founder of Jet Airways, has had plenty of difficulty letting his airline go. In fact, he recently offered a significant sum of money to help pay off some of Jet’s high debt.
Earlier this year, however, the Goyals faced a bit of drama as they were forcibly deplaned from an Emirates flight departing Mumbai. This is because they were banned from leaving India in May of 2019. The Goyals have been dogged with severe mismanagement claims when it comes to their running of Jet Airways. The SFIO has already distinguished the Goyals as key players in this investigation. As part of the investigation, both Naresh and Anita Goyal will face questioning by SFIO investigators.
Jet Airways and its former employees have so far been resilient. For many years, Jet Airways was considered as one of the superior options among Indian carriers. Now, the carrier faces insolvency proceedings.
These investigations may yield greater insight into Jet’s collapse. However, it is still rather unlikely that Jet Airways will be revived. Other carriers, both foreign and domestic, have ramped up their offerings in an attempt to restore some of the lost capacity. Furthermore, Jet Airways doesn’t have a solid fleet left. Their planes went out to many other airlines, and one 737 is now flying as a converted freighter.
Do you think there was severe mismanagement at Jet Airways? Let us know in the comments!