William Rodgers, the CEO of Winston-Salem-based Pace Airlines, was arrested Tuesday at Piedmont Triad International Airport by officials with the North Carolina Department of Insurance.
Investigators said Rodgers terminated his employee group health insurance without providing the required 45-day notice to the 337 employees who worked at Pace.
Rodgers was charged with one count of willful failure to pay group health insurance premiums, Insurance Commissioner Wayne Goodwin said. He was arrested at about 3:30 p.m. and taken to the Forsyth County magistrate for processing.
Additional charges are pending, and investigators from the N.C. Department of Insurance’s Criminal Investigations Division said they are still seeking information from Pace employees.
"The wrong man is in handcuffs. The previous owners of Pace did not pay the premiums," Pace Airlines spokesman Stuart Carnie said. "We paid the past three months insurance premiums to Blue Cross-Blue Shield. We just wrote a check last week for $223,000."
Pace Airlines announced last week that it had filed a certificate with the Federal Aviation Administration suspending operations for 90 days.
Rodgers took over at the struggling airline earlier this summer, telling employees he was optimistic that he could keep the company afloat.
Months later, the company laid off the majority of its employees -- most of whom had been waiting for more than four weeks to get paid.
Now the company must come up with $3.5 million in order to keep its FAA license. Carnie said last week that the amount the company needs to pay its bills is closer to $15 million to $20 million.
The company has been under investigation by the Department of Labor and the State Insurance Commission.
"I breathed a sigh of relief because I wanted to make sure," former Pace employee James Motsinger said of Rodgers' arrest. "I was afraid that he would wind up leaving the country -- that he would take the money because somebody's getting money somewhere."
Rodgers was released on bond late Tuesday afternoon. His next court appearance is scheduled for Oct. 16.
Goodwin said an informational meeting for Pace employees was scheduled for Sept. 29 from 10 a.m. to 12 p.m. at the Lawrence Joel Veterans Coliseum in Winston-Salem.
Pace employees were encouraged to click
for more information.
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