Airtanker scandal
Aero Union was one of six contractors involved in the U.S. Forest Service airtanker scandal. The aging U.S. C-119 Flying Boxcar firefighting fleet, including some Aero Union aircraft, was grounded in 1987 due to safety concerns; this greatly reduced the USFS's aerial firefighting capability. To quickly replace retired aircraft and modernize, the USFS organized a deal with the Department of Defense and the General Services Administration to exchange the grounded planes for more modern C-130A Hercules and P-3 Orion aircraft. The exchange program eventually allowed the contractors to acquire twenty-eight aircraft at no cost, but an absence of publicity or a public bid process led to accusations of cronyism, and the exchange was illegally carried out by the USFS: instead of merely allowing contractors to operate government-owned aircraft as per the interagency agreement, many titles were transferred, effectively giving aircraft away for free. At least four such aircraft were dismantled for parts by Aero Union and TBM. Aero Union also exchanged other planes with the USFS, with the government retaining the titles and ownership, and was required to maintain and operate them for firefighting duties. Instead, Aero Union dismantled some of them, selling parts for profit. Aero Union made an out of court settlement with the government over its actions but this was later challenged in court.
