GAO Publishes Report on FAA Approach to Aircraft Registration [1]
The Government Accountability Office (GAO) has published its report [3] to Congress on how the Federal Aviation Administration (FAA) prevents, detects, and responds to fraud and abuse in the context of aircraft registration. The FAA is permitted to issue aircraft registration to individuals and entities that meet certain requirements, e.g., U.S. citizenship or permanent residence. The GAO was asked by Congress to assess current practice under the registry for abuse and fraud. In short, the GAO found that improvement is necessary, stating that "the FAA generally relies on self-certification of registrants' eligibility and does not verify key information." Moreover, the GAO indicated that the FAA does not "proactively" consider data supplied by the Office of Foreign Assets Control to, among other things, "detect entities or individuals subject to sanctions." The report concluded that "[t]he registry is . . . vulnerable to fraud and abuse when applicants register aircraft using opaque ownership structures that afford limited transparency into who is the actual beneficial owner." The report makes fifteen recommendations, including that the FAA undertake a risk assessment of the registry and formalize coordination with law enforcement agencies. The FAA has agreed to these recommendations.