The final defendant in the longstanding Polar Air Cargo (PO, New York JFK) fraud case has changed his plea to guilty days before his jury trial and is scheduled to be sentenced in the New York Southern District Court on February 25, 2025.

Skye Xu was the last among 12 defendants to plead guilty, having contested the charges until October 22, when he withdrew his previous not-guilty plea and admitted to his part in a decade-long scheme to defraud Polar Air Cargo of more than USD32 million. Xu's bail was continued until sentencing.

Indicted on money laundering, fraud and related charges in March 2023, the defendants included former vice president and chief operations officer Lars Winkelbauer and former executives Abilash Kurien, Carlton Llewellyn, Robert Schirmer, Frank Filimaua, and Robert Lutterman. The other defendants were vendors who had business arrangements with Polar. They are Skye Xu, Benjamin Wei, Alvaro Lopez, Fabiola Cino, Orlando Wong, and Patrick Lau.

Winkelbauer, Kurien, Llewellyn, Schirmer, and Lau have been sentenced. Wei, Lopez, Cino, and Wong await sentencing on November 8, but US Attorney Damian Williams has requested that their sentencing be postponed to March 2025. Lutterman is scheduled to be sentenced on April 8 and Filimaua on April 18, 2025.

In May, Winkelbauer, who appeared to have been the ringleader of the fraud scheme, was sentenced to four years in prison plus three years of supervised release. He was ordered to forfeit USD6.7 million and repay Polar Air Cargo USD32.9 million.

According to the original indictment, the Polar Air Cargo executives had accepted kickbacks in exchange for favourable business arrangements with the vendors. They also reaped substantial financial benefits due to their secret ownership interests in certain vendors. The scheme operated at Polar Air Cargo for 12 years from 2009 to July 2021, resulting in "pervasive corruption of the airline's business, touching nearly every aspect of the company's operations for over a decade," according to the United States Department of Justice (DoJ). Winkelbauer personally received more than USD6 million from 11 vendors and used a sophisticated money laundering scheme, including falsified invoices and the use of shell companies in China, to conceal the payments.

Xu's company, Sky X Airlines, was contracted by Polar Air Cargo from September 2020 to July 2021 to provide charter flight capacity. Xu paid kickbacks to Polar executives to secure favourable deals. Court documents revealed that Atlas Air Worldwide Holdings, Polar's majority shareholder, paid Sky X about USD46 million, of which Sky X distributed around USD4.4 million to companies controlled by Polar executives. Notable payments included USD1.5 million each to Winkelbauer and Kurien and USD582,000 to former sales director Filimaua, all funnelled through third-party companies.

Other vendors involved in paying kickbacks included Griffin Cargo involving Wei which diverted USD3 million from Polar Air Cargo profits as kickbacks to the executives; Cargo on Demand involving Lau paid USD1.16 million in kickbacks; Ultimate Logistics GSA paid USD7 million; Vizion Logistics and Able Freight SVCS involving Wei and Wong respectively paid USD1.6 million in kickbacks; Gateway Cargo Consolidators involving Lopez and Cino diverted USD900,000 in Polar Air Cargo profits as kickbacks; Fato LLC involving Lopez paid USD800,000; while third-party ground handlers and trucking vendors were involved in illicit payments.