Federal authorities arrested a chiropractor in Las Vegas and indicted him for mail fraud charges for allegedly misappropriating funds he obtained from people investing in a nonexistent "no-frills" airline, U.S. Atty. Nora Manella said.
Barry Michaels, also known as Myron Blumberg, 56, is named in a 12-count indictment saying he solicited investor funds while working from an Encino office from March 1992 to April 1993 and later operating from Las Vegas.
Working with his wife, 43-year-old Holly King Michaels, Barry Michaels raised about $2.5 million and diverted about $300,000 for personal use, Manella said.
Michaels sought investor money to start an airline to be called Family Airlines, despite knowing he would fail to gain federal approval for the start-up because of past investment improprieties, authorities said. According to the indictment, he advertised in national newspapers and aviation trade journals, offering employment with the airline in exchange for investments and preying largely on unemployed pilots from the defunct airline Pan Am, which has since resumed business.
Holly Michaels also has been indicted and is expected to surrender to authorities next week.