The collapse of travel group Monarch sent a shockwave through the industry, the cause, according to Monarch was terrorism hitting its key markets and low-cost competition.
But as the dust settles, fingers are starting to point at group CEO, Andrew Swaffield and other members of the board not only for mismanagement but some dubious business events in the weeks and months leading up to the demise.
As Monarch officially ceased trading in the early hours of the 1st October like many other travel and aviation journalists we were having conversations with Monarch staff and analysts via twitter, phone and pretty much every other method you can think of.
A sense of shock was one of the overwhelming feeling that came through especially as just weeks before, Monarch was still recruiting cabin crew and pilots. This led to some staff joining the “Spotty M” and losing their jobs just weeks later.
Andrew Swaffield sent out a heartfelt message to staff saying how he was devastated by the collapse however it has since emerged that plans had well been underway for what Mr Swaffield would do next.
Airlines don’t go bankrupt overnight. The Monarch board would likely have known for at least 6 months that danger was looming. The rescue package of £165m from Greybull last year raised eyebrows as it came when many said the time had come for Monarch, as it turned out it only delayed the inevitable for 12 months and faced with losses around £100m, the decision was taken to cease trading.
Whilst market loss due to terrorism was a factor, Monarch chose to continue to operate in saturated markets instead of finding its own way when it had the chance with many opportunities missed.
This makes it even stranger when you look at the fact that a company called Shelfco 2017 Ltd was set up by Mr Swaffield and fellow Monarch Director, Christopher Bennett just days before the collapse. The purpose of the company, according to its SIC code is “Scheduled passenger air transport”.
Assets were allegedly transferred from Monarch Travel Group to Shelfco 2017 Ltd including around £600,000 in cash leading some analysts to suggest that Shelfco 2017 Ltd is a front for a new long-haul airline destined to rise from the ashes of Monarch at the expense of staff jobs. Sometimes it’s better to have a clean break rather than restructure.
Mr Swaffield also started a consulting company within 24hrs called Alcedo Consulting Services Ltd which is also listed as Scheduled passenger air transport and management consulting. Could Alcedo be advising Shelfco 2017 Ltd?
One forensic business analyst we spoke too said: “Monarch bosses, unless they were incredibly naive, would have known on the 25th September that the end was nigh and setting up a new company clearly shows a plan was in place”.
Whilst there is no suggestion of any wrongdoing by Mr Swaffield, Walking straight into what is effectively another airline as well as a owning a consulting company will leave a sour taste for those who have been left with no jobs, especially those who left secure jobs just weeks before Monarchs collapse.
If nothing else it shows that Mr Swaffield was well prepared for Monarchs demise leaving the ATOL scheme and the tax-payer to pick up the costs and over 2000 staff without jobs.