Jay Clayton, the United States Attorney for the Southern District of New York, announced that Skye Xu has been sentenced to two years in prison. U.S. District Judge Jesse M. Furman handed down the sentence for Xu's involvement in a scheme defrauding Polar Air Cargo Worldwide, Inc., a major cargo airline, of over $32 million. Xu had previously pleaded guilty to charges including conspiracy to commit wire fraud and money laundering.
U.S. Attorney Jay Clayton stated: "During the COVID-19 pandemic, Skye Xu paid approximately $4.4 million in kickbacks to Polar executives to obtain highly lucrative business from Polar. The Polar executives concealed the kickbacks from Polar using shell companies. Corruption of this type has costs that extend way beyond Polar’s or any one company’s bottom line. Today’s sentence should be a reminder that commercial bribery has no place in America."
The court documents revealed that between November 2020 and July 2021, Xu operated Sky X Airlines, LLC, based in California. During this period, he paid about $4.4 million in kickbacks to shell companies controlled by three senior executives at Polar (referred to as the “Executive Defendants”). These payments secured two profitable contracts with Polar, resulting in approximately $46 million in gross revenue and nearly $10 million in net revenue for Xu's airline.
The $4.4 million paid by Xu was part of more than $20 million received by the Executive Defendants and other co-conspirators from various customers and vendors of Polar from 2009 through 2021. This long-standing fraudulent activity involved many senior management members at Polar and affected multiple aspects of its operations.
Xu is the last among ten defendants charged in this case to be convicted; five others have already been sentenced.
In addition to his prison term, Xu, aged 43 from West Covina, California, will serve three years of supervised release and must forfeit $4,487,830 while making restitution of $1,390,000 to Polar.
Clayton commended the Federal Bureau of Investigation and Internal Revenue Service – Criminal Investigations for their work on this case.
The prosecution is being handled by the Office’s Complex Frauds and Cybercrime Unit with Assistant U.S. Attorneys Danielle Kudla, Kevin Mead, Qais Ghafary, and Jerry J. Fang leading the effort.
