Senator Seeking Federal Probe of Helicopter School that Left Local Students in the Lurch

Press Release

Senator Seeking Federal Probe of Helicopter School that Left Local Students in the Lurch

U.S. Sen. Bill Nelson is asking the Federal Trade Commission to investigate complaints he's received from Floridians who are among 2,500 students nationwide left on the hook for up to $70,000 in individual loans paid up front to a flight academy that abruptly shut its doors in Florida and elsewhere a few months ago.

The Florida Democrat will discuss his request Friday morning in Jacksonville, where he plans on meeting with a couple of former students who are upset with Silver State Helicopters, the trade school that shut down 33 locations in February. The private school had four sites in Florida, one at Craig Municipal Airport in Jacksonville, one in Fort Lauderdale, one in Lakeland and one in Melbourne, near Orlando.

About two dozen students so far have complained to Nelson's Orlando regional office that they feel they were taken advantage of, because they incurred heavy loan debt and were required to pay all of the money up front to Silver State before finishing their studies to become commercial helicopter pilots. Silver State also is under scrutiny by Florida's attorney general for possible civil violations, according to a representative for that agency.

Nelson has written trade regulators in the nation's capital asking them to expand an ongoing broader student-loan probe that started last summer. He wants to expand it by having the trade commission include complaints about Silver State, and to look at how private bank loans were issued for prospective students. The commission last summer began reviewing unrelated matters involving student loans.

Nelson noted that because Silver State didn't participate in any federal student-loan or grants program it largely was unregulated by the government. But he thinks the trade commission has oversight because of laws against deceptive practices.

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

Months before Silver State closed its doors, it was sued by the family of a pilot killed in a crash of one of its helicopters on Ponte Vedra Beach, Florida. The suit alleged the crash could have been prevented with proper maintenance. Besides the pilot, a 24-year-old Jacksonville student passenger was killed in the crash in March 2007.

The government first enacted legislation to regulate trade schools in 1992, when there were accusations that some reaped profits from federal student aid programs. For trade schools that still participate in federal loan and grant programs, they now must be able to show regulators they aren't in danger of closing precipitously. The law also requires that they get at least a small portion of their money - 10 percent - from sources other than government student loans.

Schools, like Silver State, however, aren't bound by those requirements, because they don't rely on government student aid programs.

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