Crash and burn for future helicopter trainees

There were thousands of students the Bay Area and across the country, many taking on huge debt, to fund an education that promised an exciting new career. That is not how things turned out.

Greg McCuen's dream of flying is unfolding before his eyes.

"It's amazing. It's like a parallel universe. You've got ordinary life and then you've got aviation."

It's a thrill, but not exactly what Greg had planned. He was supposed to train at Silver State Helicopter School in Oakland. He paid the $70,000 tuition in cash. Now, the school sits barricaded shut, like all 33 Silver State Schools across the country.

"It was such a shock that it actually took me about three or four days to actually digest it," says former Silver State instructor John Barbosa.

Barbosa was teaching when security guards came in February and locked everybody out.

"I guess we all just thought it was a bad dream."

Silver State had plunged into chapter 7 bankruptcy, leaving Greg and 2,700 other students in complete shock.

"Some of them in tears, saying "John, what should I do? I took a second loan on my home and now, I have to file for personal bankruptcy. My kids can't go to college,'" says Barbosa.

Greg's $70,000 is gone. Now, he's scraping up more to finish at least part of his training at Makin Air in Hayward, where John is now an instructor. Others aren't as lucky, like James Edwards of San Francisco.

"Definitely a depressing situation to be in, but I have to make do with what I got," says Edwards.

James had barely set foot in a helicopter at Silver State, but he's still on the hook for well over $250,000 dollars in loans.

"He's still not a pilot and he has to pay, or we have to pay, all this money to the loan company," says James' mother.

James works the graveyard operating a forklift. Since he was young, he wanted to fly.

Now, he wants a better life for his wife and two children. That's why he and his mother Nancy went to a Silver State recruiting seminar two years ago.

"Oh my gosh. What a salesman," says Nancy.

Silver State swept Nancy off her feet with a test ride.

"Got into the helicopter, went for a ride, it was just like wow!"

The school had bank loan officers right there. Nancy cosigned on the spot.

"We provide very low interest rates with repayment terms up to 20 years," says the promo video for Silver State.

Silver State promised a high paying career in just 18 months, with plenty of piloting jobs.

"It got me really excited," says James Edwards.

David Ross was captivated too.

He figured, "helicopters flying low around the ground, and I'm going to be part of this? This is great!"

Who was at the center of the pitch? Silver State owner Jerry Airola.

Politically connected in Nevada, Airola has been a GOP fundraiser, adviser to Governor James Gibbons and a former candidate for sheriff in Las Vegas, who lost after exaggerating a law enforcement background.

Students say, he was a charismatic salesman who pumped them up at huge Silver State seminars.

"Live your dream with Silver State helicopters and the sky's the limit," as said in the promo videos.

"The guy could talk. He could sell anything. It was all sugar coated," says McCuen.

"The snake charmers trying to get you on a good deal," says Ross.

Once students got in, promises faded.

"There would be times when the helicopters weren't there," says Ross.

"So they didn't have enough helicopters to keep the amount of students going," says Edwards.

And then, suddenly everything stopped.

"Silver State shut down. All doors locked," says Ross.

Jilted students banded together and talked online, wondering what happened to $30 million dollars investors had just poured into Silver State and tuition money paid right before the bankruptcy.

"Even though they had some 2,700 students actively enrolled at the time of bankruptcy, and even though they'd obtained loans for most of those students, they had to file bankruptcy because that money was already gone," says Michael Berger, an attorney for the students.

Berger represents 1200 students. He says Silver State operated like a pyramid scheme, constantly opening new schools to fund the older ones, even before the bankruptcy,

Students in Arizona sued the company for failing to deliver promised training. The case went to arbitration and he Nevada Bankruptcy Trustee has seized Silver State's assets. But, it's doubtful students will get any of it and many loans come due next month.

"We to have to come up with $200,000," says Nancy.

Airola did not return repeated calls from 7 On Your Side. His bankruptcy attorney declined to talk with us too. At the time of bankruptcy, Airola told employees the tightening student loan market led to the crash of Silver State. He never said anything to his students.

"Having their dreams taken away from them," says Barbosa.

"Every time I look up and see a helicopter at the beach, I stand there thinking what could have been," Edwards.

There's one bit of good news in all this. One of the largest Silver State lenders, Student Loan Express, told us it will not require repayments until it completes an investigation. Other lenders told us they are considering each student's situation, case by case.

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