By Mark Gutglueck
Federal Auditors Probing Ontario International Books For Irregularities And Diversions
A team of five auditors brought in by the federal government are poring over the books kept by the Ontario International Airport Authority and the management team at Ontario International Airport, looking for evidence of the diversion of funds and misuse of money entrusted to the joint powers authority created by the City of Ontario to oversee the aerodrome’s operations.
Information available to the Sentinel is that there are five auditors working in conjunction with the Federal Bureau of Investigation, the Federal Aviation Administration and the Internal Revenue Service making an exhaustive examination of financial activity at the airport ascertain if and how much money going through the airport’s accounts were expended on non-aviation-related activities.
What was related to the Sentinel is that the attention of federal investigators was caught when they learned that the airport had a $10 million promotional budget while comparably sized and located aeronautics facilities would normally expend roughly one-fifth of that – $2 million – on advertising and the like. Those knowledgeable about certain activities involving airport officials – including the board members of the Ontario International Airport Authority, the authority’s administration and the airport management – say that the promotional aspect of the operations became entangled with multiple professional sports teams and what turned into the illicit trafficking in and distribution of sports tickets. At one point, it was alleged to the Sentinel, the airport was spending $350,000 per year on USC football tickets and $250,000 on Kings tickets and that there have also been expenditures on Rams and Lakers tickets.

The Ontario Reign, a professional ice hockey team in the American Hockey League affiliated with the Los Angeles Kings, plays its home games at Ontario’s Toyota Arena, located within glancing distance from Ontario Airport. In an arrangement involving both the City of Ontario and the Ontario International Airport Authority, airport and city officials were provided with exclusive luxury boxes at the Toyota Arena during Reign games at which to meet with, introduce themselves to, break the ice with, glad-hand with, negotiate with and lobby other governmental officials or corporate officers. The venue of the luxury box or boxes had been broadly abused, however, according to individuals familiar with the situation, including officials utilizing the box, boxes or seating at the arena to interact with individuals with regard to matters entirely unrelated to the city or the airport, including business arrangements profiting city and airport officials. The Sentinel was provided with a figure of $2,233,180, said to the the total amount of money spent through 2023 by the airport authority on LA Kings/Ontario Reign tickets. Many of those tickets, the Sentinel was told, ended up being used by individuals unlikely to have any impact on anything to do with the airport.
Also under scrutiny by the auditors, the Sentinel is informed, is travel airport officials have engaged in. Money has been spent profligately by the airport authority, according to multiple sources, some of which contacted the Sentinel and others which the Sentinel contacted. Misspending allegedly extends to a number of consultants working on issues for the airport. It has been stated that at least some and perhaps many of those consulting contracts are nonproductive ones and the money going to those consultants is intended to buy their silence about what they know with regard to the comportment of top airport officials, primarily Ontario City Councilman Alan Wapner, who is the chairman of the Ontario International Airport Authority Board of Directors.
The Ontario International Airport Authority Board was formed in August 2012 as a joint powers authority by the City of Ontario and San Bernardino County to oversee the management, operations, development and marketing of Ontario International Airport following what at that point was hoped would be the eventual liberation of the airport from the possession, oversight and management of the City of Los Angeles and its corporate entity, Los Angeles World Airports.
In 1967, the City of Ontario had entrusted management of Ontario Airport, which at that point had no more than 200,000 passengers passing through its gates annually and had a sand flea infested gravel parking lot, to the City of Los Angeles and its airport division, which managed and administrated Los Angeles International Airport, Van Nuys Airport and Burbank Airport. Contained in the agreement was the goal of expanding Ontario Airport into a true international facility. By using their stronger negotiating position and control over gate position at Los Angeles International Airport, Los Angeles officials were able to induce more and more airlines to fly into and out of Ontario, achieving by 1969 a dramatic increase in flights out of Ontario. In short order, Continental Airlines, PSA, United, American Airlines, Hughes Air West, and Delta established routes into Ontario. This was later followed by further expansions. Though a benchmark of 10 million passengers at the airport by 1975 was not achieved, Los Angeles World Airports, the corporate entity running the Los Angeles Municipal Department of Airports, still assiduously promoted Ontario International. In 1981, a modern, second east-to-west runway was built, necessitating the removal of the old northeast-to-southwest runway. In 1985, despite the opposition of then-Ontario Mayor Robert Ellingwood, the Ontario City Council, based upon the airport having achieved all of the goals and terms specified in the joint powers authority agreement with Los Angeles, turned ownership of the airport over to the megalopolis to the west. That transaction was considered a public benefit transfer, and was done for no consideration.
Ontario International continued to make strides forward Under the management of Los Angeles and Los Angeles World Airports, which redid the airport’s concourse and then, in 1998, opened two new modern new terminals at the aerodrome. Those terminals, built at a cost of $269 million, were paid with $148 million in airport passenger user fees Los Angeles had collected on behalf of the airport over the years, some $94 million obtained from the proceeds of airport revenue bonds Los Angeles issued and sold and a $27 million grant Los Angeles obtained from the Federal Aviation Administration.
Consistently, over the four decades from 1967 until 2007, while Los Angeles was running the show at Ontario Airport, the number of passengers through the airport’s gates continued to escalate, reaching 7.2 million, an increase of 3,600 percent. The relationship between Ontario and Los Angeles vis-à-vis the airport could not have been more positive or cordial. Thereafter, however, in the fall of 2007, when all of Southern California, California and the entire nation was first gripped by what would turn out to be a six-year-running economic downturn and lingering recession, a massive financial lull hit the airline industry and airlines, in an effort to shield themselves from the continuing economic decline, began cutting back on flights, particularly to locations outside heavy population centers. Beginning in 2008 and until early 2014, passenger traffic at Ontario International declined steadily. In 2011, Ontario officials, led by Wapner, initiated a campaign aimed at wresting control and ownership of Ontario International Airport back from Los Angeles. Using aggressive and ever-increasing strident and uncivil tactics, including making pointed personal attacks on Los Angeles officials, most prominently then-Los Angeles World Airports Executive Director Gina Marie Lindsey, Wapner pressed to have the airport returned to the custody of Ontario.
In 2013, in the waning days of Anthony Villaraigosa’s tenure as Los Angeles mayor, the City of Ontario, through the Washington, D.C.-based law firm of Sheppard Mullin Richter & Hampton, sued Los Angeles in the neutral forum of Riverside Superior Court, charging Los Angeles and Los Angeles World Airports with willful mismanagement of Ontario Airport, and seeking the return of the aerodrome to the city in which it is located.
In 2015, Los Angeles relented, agreeing to finalize the return of the airport to Ontario, as of November 1, 2016, with Ontario paying Los Angeles $60 million out of its various operating funds and another $30 million taken out of its reserves, and committing to make payments of $50 million over five years and $70 million in the final five years of the ten-year ownership transition. In addition, Ontario absorbed $60 million of the airport’s bond debt. All in all, the deal was represented as a sale of the airport back to Ontario at a price of $270 million.
Wapner, who had been the prime mover with regard to Ontario reasserting control over the airport, forced himself into the lead role in overseeing, managing and operating the airport as well, capturing the presidency of the Ontario International Airport Authority from the outset. He managed at the same time to have Ontario’s second seat on the five-member authority board go to his ally on the city council, Councilman Jim Bowman. Ontario took further practical control of the authority board by installing then-San Bernardino County Supervisor Gary Ovitt, who had formerly been Ontario mayor, as a third authority board member. In making a show of regional cooperation, Ontario pushed to have individuals from outside the city and county named to the board to ostensibly help direct activities at the airport to provide benefit to the Southern California economy overall and the residents of the airport’s four-county catchment area. One of those appointees, ostensibly representing Riverside County was former Riverside Mayor Ronald Loveridge and the other was Lucy Dunn, the president and CEO of the Orange County Business Council, representing, ostensibly, Orange County.
There has been remarkable stability on the Ontario International Airport Authority Board since is 2012 inception. Wapner has remained as the board president for 12 years and both Bowman and Loveridge have continued as board members for that duration. Ovitt departed as a board member when he left the board of supervisors in December 2014. He was replaced by Curt Hagman, his successor as Fourth District county supervisor. In 2017, when the board majority forced the resignation of Kelly Fredericks, whom the board had hired to serve as the airport’s general manager/airport authority CEO upon the departure of the Los Angeles World Airports management team, Dunn resigned. The powers that be with the airport authority – Wapner, Bowman, Hagman and Loveridge – quickly moved to replace her with banking executive Julia Gouw.
Over the years there were disturbing manifestations of Wapner’s domination of the airport authority board that gave members of the public pause, as when, in September 2015, he wangled an appointment in Hagman’s county supervisorial office as a policy advisor. The spectacle of Hagman being Wapner’s boss while Hagman was serving on a governmental panel headed by Wapner struck many as something of a conflict of interest, but that arrangement remained in place for more than three years, until Wapner quietly left the post with the Fourth District supervisor’s office in December 2018.
Over the years there have accusations of improprieties relating to the action of the airport authority board, including repeated incidents of foreign travel and overlapping foreign travel by both Wapner in his capacity as a city council member and as airport authority president and Hagman in his capacity as a county supervisor and airport authority board member. Much of that travel was to the People’s Republic of China, which their mutual defenders said was part of an effort to facilitate economic opportunities and partnerships between the communist country and Ontario/San Bernardino County, with Ontario Airport serving as both a catalyst and potential beneficiary.
The sacking, or forced exit, of Fredericks in July 2017, followed by similar treatment of Fredericks’ successor Mark Thorp in January 2022 raised questions about whether members of the board, Wapner in particular, was micromanaging operations at the airport in a way that was designed to benefit himself politically or entities with whom he was associated, including massive scale donors to his political fund or others he was rumored to have financial relationships with.
Thorp was replaced by Atif Elkadi as the airport authority’s chief executive officer.
Word emanating from the airport authority headquarters was that Elkadi was tolerating activity at the airport that had not sat well with Fredericks and Thorp, which included what were considered to be nonproductive consulting contracts, contracts for services at inflated rates, the provision of no-bid contracts to certain vendors and service providers, particularly ones with preexisting relationships with board members or status as donors to the political war chests of those board members, and the expenditure of funds toward purchases of questionable relationship to legitimate airport operations. Accompanying those reports were suggestions of graft and kickbacks involving officials in the awarding of certain contracts and franchises at the airport, including maintenance and custodial service of the airport grounds and its terminal, electrical work at the facility, work on the airport facilities’ heating, ventilation and air condition systems, taxi franchises, towing franchises, rental car franchises, together with the concessions, shops and restaurants within the terminal.
Last September, amid reports that the airport authority had made expenditures on expensive items and luxuries that were of dubious value to the function of the authority of operations at the airport, John Schubert, the chief financial officer with the Ontario International Airport Authority since 2019, was either relieved of his position or departed of his own volition.
In the same timeframe, it was disclosed to the Sentinel that top echelon airport officials over the previous two years had been provided with SUVs – sport utility vehicles generally larger than standard cars – which were said to cost in the neighborhood of $100,000 each, involving lavish added features such as rims and stereo systems. Those vehicles were also been provided with regular maintenance, including detailing, washing and internal vacuuming. Those provided with the vehicles included Elkadi; James Kesler, the chief operations officer; and Jamaal Avilez, the chief administrative officer. Sources said there were other vehicles purchased, but it was not clear whether they had been assigned to other airport authority staff members. It was said, nonetheless, that the vehicles were available for use, at least on a temporary basis, by Eren Cello, the chief marketing and communications officer; Charles Miwa, the chief communications officer; and Elisa Grey, the chief revenue management officer.
For approaching three years there have been recurrent indications that the FBI and the FAA were looking into these alleged irregularities.
According to a knowledgeable source, the Ontario International Airport Authority recently sought from the Federal Aviation Authority a grant of up to $25 million to be used for improvements to the runway, taxiways and concourse. In response, the FAA within the last fortnight contacted the airport authority, telling Elkadi when he came on the line that he was being requested to arrange for one of the hotels near the airport to provide accommodations for a team of five federal auditors, who were to spend the next two weeks or as long as it would take for them to go through the airport’s and the airport authority’s books with a fine-tooth comb.
Initially Elkadi sought to put the request off for a week, but was informed that the inquiry could not be forestalled. Reportedly, the auditors are now in Ontario and have begun their work. Both Wapner and Elkadi, according to a source familiar with the situation, are beside themselves over what is going on, “sweating bullets” out of worry about what the investigators/auditors might have already found or might yet find.
There was a report that airport authority officials were seeking to hide some of the documents in the authority’s files from the auditors.
The Sentinel this week sought to contact Wapner, Bowman, Hagman, Elkadi and Kevin Sullivan, an attorney with the law firm of Gatzke Dillon & Ballance LLP, who serves as the airport authority’s legal counsel. After phone calls failed to elicit a response, the Sentinel sent emails to all five. The Sentinel offered each of them an opportunity to put the airport authority’s best foot forward and reassure the public and the Sentinel’s readership that nothing untoward is ongoing out at the airport and to provide a benign interpretation of what it is the auditors are doing at the airport. The Sentinel asked if there was nothing in the airport’s books that reflects badly on the airport authority board and the airport authority/airport management and administration. The Sentinel asked what response they would give on behalf of the airport/airport authority with regard to suggestions that the airport/airport authority’s books had been cooked and that the auditors are on the brink of demonstrating that Elkadi and Mr. Wapner, perhaps along with some others, had violated their positions of public trust.
The Sentinel asked the five to provide a rationale for the airport authority’s/airport’s hefty promotional budget and a definitive assurance that the money put into that budget had not been misused. The Sentinel sought a statement from the officials and the lawyer that the travel engaged in by airport/airport authority officials was entirely related to airport business. The Sentinel inquired about what purposes the sports tickets purchased by the airport authority had been put to.
The Sentinel inquired of Sullivan whether he had knowledge regarding airport authority officials having salted any funds away into foreign banking institutions, in particular ones in Hong Kong, Shanghai, Chaozhou, Zurich or Ankara
By press time, neither Wapner nor Bowman nor Hagman nor Elkadi nor Sullivan had responded to the Sentinel’s inquiries.