Thorough inquiry into airline's collapse is due

WHERE is the money? Last month 3,400 passengers were stranded abroad and 550 staff made redundant when the airline FlyGlobespan collapsed. First impressions were that the company was just another victim of the parlous economics of the international airline industry amidst the global downturn. But the story has grown more complex – and altogether more worrying – as further facts emerge.

FlyGlobespan was owed some 35 million by E-Clear, the company which handled online sales for the airline. This was money paid by passengers for their tickets and which was due to be transferred to FlyGlobespan. But despite requests, this money was not transferred. This played a critical part in FlyGlobespan's downfall. Now E-Clear has been put into administration and a search has begun across Europe to find the whereabouts of the funds. As in so many cases, a cardinal rule of investigation applies: hunt the money. It does not at this stage appear to be sitting in an E-Clear bank account pending transfer. Indeed, according to one creditor, the company and its chief executive, the Greek Cypriot businessman Elias Elia, had "very little money in their bank accounts".

As recently as last week, the chairman of E-Clear's advisory board, Sir Edward du Cann – the former Tory grandee and ex-chairman of Lonrho, who was declared bankrupt in 1994 with debts of 1.2m – was insisting on the firm's good financial health. A full investigation into the collapse in surely due.