Helicopter School May Face Inquiry

LAKELAND - U.S. Sen. Bill Nelson wants the Federal Trade Commission to investigate the practices of a national helicopter flight school with a branch in Lakeland that filed bankruptcy and closed in February.

When the Silver State filed bankruptcy, it left many of its 2,500 flight students nationwide who borrowed money to pay the $70,000 tuition facing massive debt and with little prospect of finishing their training.

"These students were trying to get ahead in life by attending a trade school," Nelson, a member of the Senate's Commerce Committee, said in a news release. "Instead, they ended up with huge debt."

Nelson specifically is focused on the private sector loans many of the students received to attend Silver State. He wants the FTC investigation to include them in its ongoing inquiry into student-loan practices.

The Silver State case differs from the other student loan controversies because the school did not participate in any federal student loan or grant programs. Because of that, the school and its loans largely escaped federal regulation, Nelson said.

'Unfair Marketing Practices'?

But he thinks the FTC has authority to investigate because of allegations the school and private lenders engaged in deceptive practices.

"I have heard from many former Silver State students who say they were steered toward specific private student loan lenders, who, in conjunction with the school, may have engaged in deceptive and unfair marketing practices," Nelson wrote in a letter to FTC Chairman William E. Kovacic.

Nelson, who was scheduled to meet Friday in Jacksonville with several former Silver State students, did not provide specific examples.

The school, which had branches in Lakeland, Fort Lauderdale, Jacksonville and Melbourne, closed without warning after filing Chapter 7 bankruptcy in February, leaving students nationwide in the lurch.

The privately owned Las Vegas-based company said a downturn in U.S. credit markets severely curtailed the availability of student loans and resulted in a sharp and sudden downturn in student enrollment. Chapter 7 in U.S. bankruptcy court leads to the dissolution of a corporation and sale of its assets.

Triple Financial Whammy

Many of the students and instructors at the Lakeland branch described a sort of triple financial whammy in the school closing: loss of some or most of the investment in their training, new costs in finishing training somewhere else and the loss of instructor jobs with the company, which many students said they were pursuing.

The instructor jobs acted as a sort of internship for graduates of the program, who are not very marketable as pilots until they have logged 1,000 hours of flight time, several students said.

In teaching, the instructors gained flight time they could convert into noneducational civilian jobs upon reaching the 1,000-hour threshold. There were about 12 instructors for the more than 100 students of the Lakeland program.

Reporter Billy Townsend can be reached at (863) 284-1409 or