Businessman disputes connection to airline accused of fraud

Posted: Thursday, June 28, 2001

ANCHORAGE (AP) -- Businessman Neil Bergt disputed on Wednesday the Justice Department's assertion that he is an owner and operator of Alaska Central Express, a cargo airline he helped found in 1996 that is being accused of illegally keeping $365,000 in Postal Service overpayments.

The airline and its holding company, Western States Investment Group, were named in a lawsuit brought Monday by the U.S. Attorney's Office in Anchorage under the federal False Claims Act. The government acted 14 months after a former employee of Bergt, Albert Wilt, sued Bergt, his son Mike and the airline over the alleged overpayments, entitling him to a share of the money if the government wins the case.

Wilt's complaint is under seal in U.S. District Court in Anchorage.

In its own complaint, the Justice Department, while not naming either Bergt as defendant, said they ran the company along with Bergt's wife, Anne Butler. The three created the company in 1996 after the demise of Bergt's passenger airline, MarkAir.

In an interview from the offices of Homer Air, where he now works, Bergt told the Anchorage Daily News that he is under orders from the U.S. Department of Transportation to not manage Alaska Central Express, and he has followed that demand. He said his son is in charge.

In his lawsuit, Wilt said that while the cargo line's employees were required by the government to certify that they would not accept directions from Bergt, he and others were intimidated by verbal threats from Bergt into not reporting the alleged overpayments to the Postal Service.

Bergt decried Wilt's statements as an ''allegation from an admitted felon'' who stole from him and the airline.

''The thing was all concocted by a guy who's doing time in a federal prison,'' Bergt said.

Wilt, the former chief financial officer of several Bergt companies, pleaded guilty to embezzling $368,000 from Alaska Central Express and last month began serving a 21-month sentence at a minimum security federal penitentiary in Oregon.

Wilt's attorney said investigators from the Postal Service's inspector general's office corroborated his account of overpayments.

A lawyer for Bergt said the company has repaid all but about $60,000 of the disputed funds, though the Justice Department is seeking triple damages -- more than $1 million -- as provided by the False Claims Act.

The overpayments stem from different rates charged by the airline for shipping to Bush villages and between regional centers. The government accused Alaska Central Express of knowingly accepting payments at the higher Bush rate for mail that should have traveled cheaper, and using ''false records or statements'' to conceal its obligation to return the money.

Bergt said the airline never billed the Postal Service for the higher rates. On its own, the government wired payments to the company, he said.



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