United Airlines Chief Resigns Over Corruption Investigation

Date: September 8, 2015 | Source: New York Times

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The airline is under investigation by the United States attorney in New Jersey over whether it had improperly sought to influence senior officials at the Port Authority of New York and New Jersey.

The company said it had named Oscar Munoz as president and chief executive to replace Mr. Smisek, the company’s chief executive since it merged with Continental Airlines in 2010. Mr. Munoz, a member of the United board, previously served as president and chief operating officer of the rail giant CSX.

“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 company said in a statement. “The investigations are ongoing and the company continues to cooperate with the government.”

United’s executive vice president for communications and government affairs, Nene Foxhall, and the senior vice president for corporate and government affairs, Mark R. Anderson, also resigned, the company said.

In February, federal prosecutors issued subpoenas focused on whether the former chairman of the Port Authority, David Samson, had pushed United to reinstate flights that he used to travel to and from his weekend home in South Carolina.

Ms. Foxhall and Mr. Anderson were among the United officials whose communications with the Port Authority had been subpoenaed.

The Port Authority runs several airports, including Newark Liberty International Airport, one of United’s biggest hubs.

Mr. Samson was appointed by Gov. Chris Christie of New Jersey in 2010. He stepped down in March 2014 when records showed that several senior aides to Mr. Christie worked with Port Authority officials to close down lanes of the George Washington Bridge under false pretenses to punish a mayor.

Several months ago, United asked the law firm Jenner & Block to conduct an internal investigation into the airline’s dealings with Mr. Samson and the Port Authority.

At the time, lawyers close to the case predicted that this would lead to the resignation of Mr. Smisek and possibly other executives, in the hopes that the airline itself could avoid prosecution.

The resignations also complicate the fortunes of Mr. Christie as he tries to resurrect his once-promising presidential bid, by underscoring the accusations of cronyism that have dogged his administration since the bridge scandal broke in early 2014. The governor has distanced himself from other figures implicated in the scandal, saying that they deceived him. But Mr. Samson, despite his resignation, has remained one of the governor’s closest advisers.

Karen Kessler, a spokeswoman for Mr. Samson’s lawyers, said they had no new information about the federal investigation, and she declined to say what it might mean for Mr. Samson. “This is a United matter,” she said.

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