Zoom Airlines is under investigation by bankruptcy trustees for millions in transfers and unpaid loans, according to media reports.
Court documents filed in the Ontario Superior Court of Justice in Toronto by Ottawa-based Doyle Salewski Inc. say Zoom gave $6 million in loans to partner and tour operator Go Travel Direct Inc. The law firm representing Doyle Salewski, Bennett Jones LLP, has reportedly asked Go Travel to repay the funds.
A letter sent to Zoom and Go Travel co-owner Hugh Boyle's home specified Doyle Salewski is looking to "trace and collect monies owing."
In addition, Mr. Boyle has apparently been asked to repay a separate $6.1 million in loans. Another $14.8 million connected to Zoom's purchase of Go Travel preferred shares is also under investigation.
"In the 36-month period prior to declaring bankruptcy, Zoom was engaged in significant transfer of funds, loaning money to related parties," said Paul Salewski, senior vice-president of Doyle Salewski, in court documents.
Mr. Salewski said the probe is "reviewing these transactions to determine if they were a breach of the fiduciary responsibilities of the directors."
The airline also allegedly owes around $200,000 in unpaid wages to some of its former 710-employee staff in Canada and the U.K.
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