Hahn Air Lines GmbH, along with its U.S. subsidiary Hahn Air USA Inc., has agreed to a significant Travel Fee Settlement, resolving allegations of violating the False Claims Act. The German-based travel company will pay $26.8 million to the United States government, addressing claims that it knowingly failed to remit mandatory travel fees collected from airline passengers.
Hahn Air operates a global electronic ticketing system, enabling travel agencies to book flights on various airlines. As part of this service, Hahn Air collects certain mandatory travel fees, some of which are owed to the U.S. government. The core of the legal issue was the alleged failure to properly pass these fees on to the relevant U.S. authorities.
The settlement addresses accusations spanning from 2012 to 2018, during which Hahn Air allegedly knowingly avoided paying specific travel fees. These unpaid fees include: Agricultural Quarantine and Inspection User Fees for the Department of Agriculture (USDA), Customs User Fees and Immigration User Fees for Customs and Border Protection (CBP), and Passenger Civil Aviation Security Service Fees for the Transportation Security Administration (TSA). These fees are essential for maintaining critical services related to travel safety and security within the United States.
“Companies that benefit from air travel in the United States must pay their fair share of the costs associated with such travel,” stated Principal Deputy Assistant Attorney General Brian M. Boynton, of the Justice Department’s Civil Division. “This travel fee settlement demonstrates our commitment to protecting taxpayers by ensuring accountability for all entities obligated to make payments to the United States.” This strong statement underscores the government’s focus on enforcing financial obligations within the travel industry.
U.S. Attorney Matthew M. Graves for the District of Columbia further emphasized the point, saying, “Companies cannot pocket government taxes and fees collected from their customers for their own benefit. This settlement serves as a clear message that intentional disregard for these obligations will be met with substantial penalties.” This highlights the severe consequences for companies attempting to misuse funds meant for government services.
Inspector General Joseph V. Cuffari of the Department of Homeland Security (DHS) also commented on the collaborative effort behind the settlement. “Today’s multi-million dollar travel fee settlement is a testament to our collective efforts and demonstrates that the United States is committed to holding corporations accountable when they fail to comply with the law.” The involvement of multiple agencies illustrates the seriousness with which the government pursued this case.
Acting Special Agent in Charge Charmeka Parker of the USDA Office of the Inspector General (OIG) added, “Participation in Government travel business programs is a privilege, not an opportunity to evade travel costs owed to the U.S. Government. This resolution proves our dedication to safeguarding the integrity of government programs and holding accountable those who seek to defraud them.” This statement emphasizes the importance of ethical conduct within government-related business operations.
The case originated from a qui tam lawsuit, filed under the whistleblower provision of the False Claims Act. This provision allows private individuals to file lawsuits on behalf of the U.S. government and receive a portion of the recovered funds. In this instance, the whistleblower will receive approximately $4.8 million as part of the travel fee settlement. The case is formally captioned U.S. ex rel. MGSNOVA Advisory, LLC v. Hahn Air, Inc. et al.
This successful resolution was the result of coordinated work between the Justice Department’s Civil Division, Commercial Litigation Branch, Fraud Section, and the U.S. Attorney’s Office for the District of Columbia, with crucial assistance from the Offices of Inspector General for DHS and USDA. Trial Attorney Richard W. Hagner and Assistant U.S. Attorney Darrell Valdez were key figures in handling the matter.
It is important to note that “The claims resolved by the settlement are allegations only. There has been no determination of liability.” While Hahn Air has agreed to the travel fee settlement, this statement clarifies that the agreement is not an admission of guilt, but rather a resolution to avoid further legal proceedings.
