Hawaii to enforce
penalty over bogus airline

The state of Hawaii Office of Consumer Protection has begun collection efforts to obtain a $25,000 civil penalty assessed against a Massachusetts college student whose promotion of a nonexistent airline bilked Hawaii and mainland consumers out of thousands of dollars.

Luke R. Thompson was an 18-year-old freshman at Babson College in Wellesley, Mass., in 2003 when he was accused of selling discount airline tickets over the Internet for flights from Los Angeles to Hawaii on Mainline Airways. He had taken presale reservations for fares as low as $89 even though he had no baggage claim, ticket counters, flight crews, leased planes, or permits to operate flights.

Thompson later said he originally planned for his business to become a tour provider, not an airline, and that he planned to subcontract everything from the airplanes to the ground staff.

Massachusetts Attorney General Tom Reilly announced last month that Thompson had made full restitution of about $80,000 to 212 consumers following a settlement of a lawsuit filed in Suffolk Superior Court. The settlement also prohibits Thompson from advertising, publishing or selling airline tickets, vouchers or fares unless authorized by the U.S. Department of Transportation. The judgment also imposed a suspended $5,000 civil penalty.

However, Thompson has yet to pay a $25,000 penalty that was imposed against him in September 2003 by Hawaii Circuit Court Judge Eden Elizabeth Hifo. Thompson filed for bankruptcy in February of this year, but the Hawaii Office of Consumer Protection recently obtained a decision from the Bankruptcy Court of Massachusetts saying that Hawaii could proceed with its collection efforts.

"We're still in the process of doing that," Steve Levins, executive director of the Office of Consumer Protection, said yesterday. "We have to find assets and execute on the assets. Whatever assets he has that we're able to find to satisfy the judgment, we're going to try and do that."