AIR AMERICA SWINDLE FOR DUMMIES

Michelle has a long post up that sort of details what seems to be a package of undecipherable legalese and corporate gobldy gook. Unfortunately this kind of transaction is all too common, and only because I have some training in figuring out quarterly statements, financial statements, and other corporate shit, I know exactly what this is about. To put it as simply as possible....

1. You are a car mechanic. I sell you a car with defective breaks and don't tell you because you didn't ask. The only thing is that a car mechanic will always ask, so if the mechanic buys the defective car anyway, something stinks. Why? Well let's say he buys the car from his brother who not only owes the original car dealer, but a bank that he lied to so he could get even more money. He owes more on the car than the car is worth.

2. The buyer (mechanic) now attempts to cover up the deal so he doesn't have to pay the bank and the dealer. How? He forms a Limited Liability Corporation with the hisself as head and then the LLC buys the car from hisself for a promisary note.

That is the normal swindle. These guys took it very far down the line by borrowing from a charity they never intended to pay back and then formed another LLC in order to hide it further.

Now this would never fool anyone who seriously looked at the final company. But it is designed to fool regulators, cops, and dopes they hope to borrow more money from so long as nobody looks too close. This type of game is done all the time.

To sum it up: you make the transactions as complex as possible so nobody can figure out what is going on. The only purpose is to avoid paying any debtor anything while keeping the asset (car).