"DARK SIDES" OF A320 CRASH: WHO WILL BE LEFT "HOLDING THE BAG"

Regnum, Russia
Nov 2 2006

"The crash of Armavia’s Airbus A320 near Sochi on May 3, 2006 was
caused by the failure of the plane’s navigation system," a reliable
source from the air circles of France has told REGNUM.

It says that "on the night of the crash, there was almost zero
visibility in the area, and the pilot was guided exclusively by the
commands of the controller and the parameters of the sensors."

"During the landing, many passengers – due to their national
peculiarity – began calling their relatives on their mobile phones
in order to tell them that they were already arriving. The calls,
first, disturbed and, then – during the second approach – upset the
navigation system. The experts note that it was exactly after the
second turn that something strange began to happen to the plane and
the crew and the crash followed right afterwards."

The source says that "the investigation is being dragged on because
the sides are searching for the ‘scapegoat,’ and the Armavia company
will certainly be the one – even though it is not guilty."

"There are four concerned parties to this tragic story – Russia,
Airbus, Armavia and the re-insurer. The insurance contract says that
the beneficiary party is Airbus, but it also has a proviso that the
party responsible for a crash should recompense the re-insurer’s
indemnity expenses. In this particular case, Airbus may be the guilty
side and may be doing its best to conceal the information about
the failure of the A320," says the source. It notes that "the point
is not that Airbus has no money to pay the indemnity. Simply, the
problems of such big companies are usually a matter of international –
presidential-level – politics." The source notes that "exactly at that
time Airbus was preparing to sell 150 planes to China (the relevant
agreement was reached during the Chinese leader’s visit to France)
and the company was very much worried lest there might be a top-level
scandal."

"In fact, Airbus has ensured its immunity, while Russia will never take
the blame for something it did not do. Meanwhile, the re-insurer wants
his money back. The only way-out for the sides is to leave somebody
‘holding the bag’ and Armavia will be the one. That’s exactly why the
Armenian side was minimally involved in the investigation. Armenia was
not provided with all decoded data under the pretext that it might
give publicity to secret information," says the source. "There was
one more fact left. It was Armavia’s second plane – an absolute copy
of the crashed one, the plane that could be used for so-called bed
tests and where one had ‘suddenly’ found the technical documentation
of the crashed A320," says the source. To remind, the second A320
burned down in a servicing hangar of the Belgian airport, with no
tests ever conducted.

Asked if it was possible to test another air liner of the same
configuration, the source said that one should consider the fact that
the company got the plane from "third-rate" countries. There is one
more interesting circumstance: the black boxes were found only after
the fire in the hangar in Belgium.

The source notes that there are many "dark sides" in this story.

"But the darkest side is the insurance of Armavia’s plane. As you
may know, at first, part of Armavia belonged to Sibir Airlines. Their
insurer was a Russian company who insured Armavia’s aviation risks for
twice as much as on the market and used quite a strange reinsurance
scheme. The risks were, first, given to the Malakut reinsurance broker
(Russia), who gave them further to the United Brokers company. Only
then the risks were reinsured on the British market," says the
source. "The point is not even why they used two brokers, but that
50% of the money disappeared somewhere between Malakut and United
Brokers," says the source. "In fact, their objective was to pump
out as much money from Armenia as possible. But the strangest thing
is that Armavia’s owner and re-insurer (Grand company) have changed
but the scheme and the tariffs are the same. We can only guess who
is receiving all this money," wonders the source.

In fact, this version explains why Armavia’s owner has decided to
get rid of the company’s shares.