Two guilty of fraud over Hawaiian Airlines

NEW YORK (Reuters) - One man has been convicted and another has pleaded guilty in a multimillion-dollar scheme to defraud a bankruptcy court in the bidding to take over Hawaiian Airlines four years ago, U.S. officials said on Thursday.

The two men, William Spencer and Paul Boghosian, were indicted in April 2005 on charges of falsely stating to the bankruptcy court in Hawaii that their Hawaiian Investment Partners could provide up to $500 million in financing to carry out its proposed reorganization plan for the airline.

Court documents said the plan was a hoax with no real financing to support it.

Spencer, 77, the pastor of the House of Truth in Oakland, California, was convicted on Wednesday after a two-week jury trial in U.S. District Court in Manhattan, the office of the U.S. Attorney said in a statement.

It said Boghosian, 54, of St. Louis, pleaded guilty on October 29. Both men will be sentenced on January 30, when they each face a maximum penalty of five years in prison.

Hawaiian Airlines, a subsidiary of Hawaiian Holdings Inc, filed for Chapter 11 bankruptcy protection in 2003. By November 2004, two competing reorganization plans, including the one by Spencer and Boghosian, were pending in the bankruptcy court.

The airline emerged from bankruptcy in June 2005.

The indictment had also said Boghosian, in an effort to obtain funding for his reorganization plan, had offered a $500,000 bribe to obtain a $2.5 million loan from a hedge fund. He was accused of trying to bribe an FBI undercover agent who portrayed himself as a hedge fund manager.

(Reporting by Grant McCool; Editing by Lisa Von Ahn)