United CEO steps down amid corruption investigation
09 / 09 / 2015
United Airlines chief executive Jeff Smisek and two other senior officials have stepped down from their positions as a result of an ongoing US federal investigation into alleged corruption.
The airline said that along with Smisek, the executive vice president of communications and government affairs Nene Foxhall and senior vice president of corporate and government affairs Mark Anderson had also resigned.
The investigation relates to whether the airline traded favours with the Port Authority of New York and New Jersey.
According to reports, the airline allegedly re-started a money-losing flight from Newark to Columbia to benefit the port authority chairman at the time, David Samson, who had a holiday home near the South Carolina hub.
The airline said: “The departures announced today are in connection with the company’s previously disclosed internal investigation related to the federal investigation associated with the Port Authority of New York and New Jersey.
“The investigations are ongoing and the company continues to cooperate with the government.
“The company’s internal investigation and the related circumstances do not raise any accounting or financial reporting concerns.”
United said that board member Oscar Munoz would take over as president and chief executive officer.
The airline said Munoz had broad experience in the transportation industry and large consumer brands including AT&T, Pepsico and The Coca-Cola Company.
He most recently served as president and chief operating officer of intermodal transport firm, CSX Corporation.
Smisek was chief executive of Continental Airlines before it merged with United in 2010. In the second quarter, the airline reported second-quarter 2015 net income of $1.3 billion excluding $67 million of special items.
It is also in the midst of a row over the growth of Middle Easter airlines in North America.
American, Delta and United argue that Middle East carriers Emirates, Qatar Airways and Etihad Airways have benefited from $42bn in state handouts, something the trio have vigorously denied in an increasingly bitter public row.
The North American trio have called on the US government to review the Open Skies policy that authorised commercial flights between the US, Qatar and the United Arab Emirates over a decade ago.
Meanwhile, FedEx and Atlas Air have joined up with two other US carriers to create the US Airlines for Open Skies Coalition, in support of Middle East Gulf airlines who have been accused of distorting competition via state subsidies.