The estate is grand: 1,472 acres, or nearly six square kilometres in size. After driving through the iron gate, we drive past magnificent villas before entering the majestic driveway. The manor itself has 22 bedrooms, three fully-equipped kitchens, a bar and billiard room in the basement, and a wine cellar, as well as a reception area, living room and banquet hall.
And this is Michele Ballarin's home. Or Michele Lyn Golden. Or Michele Roosevelt Edwards, as she now calls herself. The businesswoman, who has operated cargo flights in Africa, owned an arms company in the United States but also a restaurant, engaged in real estate business and ran her own investment bank, or so she says.
Her first husband’s last name was Golden. A few years after his death, she married a man named Ballarin. Now she tells RÚV’s Kveikur programme that she wants to use her maiden name, Edwards, in honour of her recently-deceased father. Her grandfather was Leon Roosevelt Edwards.
In Somalia, she was known as Amira, the saviour who mediated in difficult pirate affairs. According to documents obtained by Wikileaks, however, the Somali Foreign Minister sent a letter to his colleague, Hillary Clinton, in 2009, to complain about Ballarin’s involvement:
„In fact, her actions incite the pirates to the groundless increase of the ransom sum offered by the owner of the vessel, thus creating an obstacle for the positive solution of this issue. [...] I address you with the request to facilitate the exclusion of Ms. Golden-Ballarin from the negotiation process with the pirates,” the minister wrote in the cable published by Wikileaks.
The woman who bought WOW air
Icelanders know Michele, as we have decided to call her, as the woman who bought WOW and wanted to rebuild it. In September 2019, exactly six months after the collapse of WOW, she held a press conference to announce the acquisition and the resumption of scheduled flights a month later, in October 2019. The route network would be similar to that before WOW went bankrupt. Keflavík would be the European hub and Washington the US hub.
But not much has happened. WOW is not up and running, or flying, although Michele has repeatedly announced news, reported high-level appointments in Iceland, Russia, and Italy, discussed how WOW will also be flying from Italy and even her involvement the restructuring of the Italian airline Alitalia. Nothing has so far materialised.
But when Kveikur met Michele at her home, she stuck to her idea of what she calls "honest fares", where everything is included. In her opinion, travellers should be able to calculate the total cost of travel right away, instead of having to go through a complicated booking process, paying extra for leg room, luggage, food and WiFi on board. A ticket with the new WOW, she says, will include all of this and as much luggage as a passenger can get from their home to the airport. All of it will be on board. On top of that, the middle seat will be empty. In it, a food hamper will be placed.
“It's for an innovation that has to do with a bit of privacy, as well as the ability to remove food service by galley carts and flight attendants,” she says when asked to explain.
But how will this work? Michele replies that passenger jets from Airbus, which will form the company’s initial fleet, have the ability to do that. “And there are other innovations [...] we're not going to do a deep dive into our into our model, but that's to be unveiled at the right time,” she adds. She says her team has worked hard to develop new avenues that other airlines cannot follow because they are too slow and cumbersome, with too many high-paid executives at work. However, she does not want to explain the operating plan further right now; all this will be based on volume, as she puts it.
How is this supposed to work?
Michele and her colleagues hired a team of experts last spring to work on these ideas. Most have since quit and Kveikur talked to several them. No one understood how these ideas were supposed to work out, technically or financially. Today, WOW is still just what Michele and her team bought from the estate: 160 aeroplane seats on pallets and 500 galley carts in containers, as well as the purple brand.
The former employees of the new WOW that Kveikur spoke to are convinced that WOW will never return to the skies. The idea was probably to try to create buzz around the relaunch and sell the company at a profit, but the knowledge needed was lacking and the COVID-19 epidemic dealt the death blow, although Michele is still talking about starting scheduled flights in the first quarter of this year.
"We will start flights from Boston, New York, Dulles International Airport in Washington and Miami in the first quarter of 2021. And domestic flights in the United States will begin in the third quarter," she says firmly, despite the fact that the situation in November, when the interview took place, did not look promising for global tourism.
Kveikur contacted the aviation authorities in Boston, Miami, Dallas, and Washington. Spokespeople had not heard of WOW air. If commercial, passenger flights are to start in the first quarter, the paperwork should be completed already. But in Washington, the spokesperson Kveikur contacted reported that a meeting had been held with the WOW team in August 2019. Since then, nothing had been heard from them. And it is not clear that the company has the necessary licence to operate passanger flights.
At the end of January, Kveikur asked in writing about the operating licence and received the answer that USAerospace Partners, the parent company of WOW, "had access" to companies with the necessary licenses and that it would be easy to deal with those matters when the time came. Páll Ágúst Ólafsson, WOW's lawyer in Iceland, said in an interview with Kveikur that he not aware of any preparations in Iceland to resume scheduled flights in the near future.
Nevertheless, Michele said in November that she had recently signed a contract to lease ten brand new Airbus jets. Two of them were in Miami, in livery. Although Michele promised to send photos of the planes as soon as they were ready, none have been received so far. When Kveikur asked for them at the end of January, the answers were that they would be part of a marketing campaign at the right time.
The take-over of Icelandair
A year after the press conference in September of 2019, where the purchase of part of WOW's assets was announced, Michele was in the headlines in Iceland again. Her seven billion ISK offer for shares in Icelandair was rejected and the CEO of Icelandair said in an interview with RÚV that in one case the subscriber had not been able to confirm financing and therefore that subscription had been rejected.
Michele completely denies this in an interview with Kveikur. But why didn’t she suit the company?
“We don't want to come in broadside like that and spin up a huge massive legal case on this. If we want to come in on shareholding with Icelandair I believe that the existing management style will very soon reveal another opportunity for us to avail ourselves of that.”
She believes that Icelandair's management feared that it could demand changes in the management team.
Michele says that Icelandair's position was worse this autumn than WOW's position when that company went bust. Icelandair should have “knocked it out of the park” given the fact that the main competitor disappeared overnight, but that did not happen.
“They had to go back to the government and ask for more money, back to the well. And that's why Icelandair will not succeed going forward unless it drastically changes the way it does business, which I can't foresee,” she says.
But does she own shares in Icelandair today?
“There are entities that hold shares, that we're connected to, is the best way to answer that.”
When asked for further explanations, she says that others hold on to things on their behalf but that she is the real owner.
And she has certain ideas about how Icelandair's operations need to be turned around to save the company. However, it is not in its interest to outline these measures at this time, but Icelandair's management will have to find out for themselves.
"I'm going to create enough competition for them to find their way."
The goal is to merge the new WOW and Icelandair, to become WOW-Icelandair, the Icelandic wing of an international airline. Icelandair's twenty largest shareholders own a total of 44.5% of the company. They are publicly listed, and Michele Roosevelt Edwards is not among them. The twentieth shareholder on the list has a share of almost one percent, so if someone owns a share in Icelandair, on behalf of Michelle, that share is less than one percent. Páll Ágúst, WOW's lawyer, says that he did not organise the purchase of any shares in Icelandair on Michele’s behalf.
Christian values and unpaid bills
When Michele is not traveling, she says she goes to church every Sunday and plays the organ there. She was raised in a religious family; the church and religion mattered to her.
“We're a faith-based organisation, which is very, very important for us. What it means is that the things that you learn as a child, about sort of the sort of the golden rules, if you will, that are better biblically oriented, give us our moral compass and tell us the right way to operate when we are little children with each other. Be fair, don't fight, don't take things away from people.”
The former employees of the new WOW that Kveikur spoke to say they didn’t see these values in action. On the contrary, they believe that they were hoodwinked, lied to and that the contracts made were not kept. Bills and salary weren’t fully paid, in some cases not at all.
“We hired a technology group to build out a ticketing system and paid a great deal of money for that and never got what we thought we would get. In fact, we don't have anything really that's been completed.”
In mid-January, the Reykjavík District Court reached a different conclusion. WOW LLC, the parent company of WOW in Iceland, was sentenced to pay an invoice of more than ISK 40 million in addition to interest, as WOW's lawyer could not prove any defects in the software.
And Michele does not want to go into detail about operations in Iceland, says someone else is responsible for them, even though she is the sole owner and manager of WOW.
“All I know is that a US company, here, WOW, is the one who contracts for US employees. We would not use a US company here to hire someone in Iceland, because there would be all kinds of jurisdictional questions and taxing questions and so forth. So that's something you'd need to refer to that side”
Kveikur therefore directed the question to Páll Ágúst Ólafsson, WOW's lawyer in Iceland.
"Naturally, I cannot answer for what happens outside Iceland. There are others who must answer for that. But salaries have been settled in this country and paid to those who have been hired to work in Iceland.” In fact, payments to some foreign employees and contractors went through Páll Ágúst and Iceland according to documents that Kveikur has seen. In some cases through Páll Ágúst's law firm and companies that were not officially connected to WOW, but Páll Ágúst personally. "It is simply risk management," he says when asked about this twist. And adds that there is nothing wrong with that.
The former employees that Kveikur spoke to say that they have not been paid in accordance with what has been discussed, payments have been delayed or even never received. None of these former employees wanted to give an interview on camera because they did not want to be publicly associated with WOW. They thought it would not be to their advantage.
When Michele is asked about their allegations of untruths and reminded of foreign media coverage of her previous projects, where similar allegations have been made, she answers little but says it is embarrassing to present the case in that way.
“I find it very awkward thing to say. Because frankly the money that I have in WOW is my money so it's my decision what I do and if I decide to go in a certain direction.”
So, who owns WOW?
When Michele announced the acquisition of the assets of the WOW bankruptcy estate in September 2019, she was asked about other shareholders. "We don’t want to talk about who our partners are right now. I think that will be sort of fully disclosed in due course," she said in an interview with RÚV at the time.
In the interview in November, little had changed. Other investors weren’t involved, but: “We are soon to announce a strategic relationship with a publicly traded major company and all will be clear in the near term.”
According to Kveikur's sources, the connection did not materialise, but Páll Ágúst, WOW's lawyer, says that foreign investors have joined the company, which he is not authorised to disclose further.
At the press conference in September 2019, Michele said that the company was fully funded and that 85 million dollars, 11 billion ISK, had been committed to the business. In November 2020, she said in her interview with Kveikur that she had invested 7.5 million dollars in the project, just under a billion ISK.
HQ not in Iceland
Despite Michele's statements about passenger flights in the first quarter of 2021 and ten Airbus planes in the interview in November, nothing has happened to date. When Páll Ágúst is asked how close WOW is to being airborne again, the answer is fuzzy, but in a way also decisive:
"It is a very good question. And I wish I had a concrete, simple answer to that question. But there are simply so many complexities in that the question will not be answered in a simple way."
None of the employees hired at the beginning of 2020 are working anymore, according to Páll, due to the situation in the world today but also due to the changed emphasis of those behind the operation regarding Iceland and Icelandic involvement. Although Michele has spoken about Iceland, her interest and emphasis has shifted from the country. Costs in Iceland are high and it has been difficult to find a partner with an operating licence.
"The only thing that is clear is that Iceland will be a destination. There will be activities here. How extensive they will be, remains to be seen, "says Páll. "Let's put it this way, WOW's headquarters will not be in Iceland."
Michele hired a manager to build WOW in Russia and another to lead WOW Italy, although he is actually based in Chicago in the United States. In an interview with Kveikur, she claimed that a large announcement on a new project was due, the restoration of the airline Alitalia, and that she would be involved in the project at the request of the Italian government.
An article in the newspaper Corriere della Sera this summer discussed these plans in a rather sarcastic way. Michele's representative outlined ideas similar to those she has for a new WOW. But two months later, there is no news, and when the Italian government announced the end of Alitalia at the end of the year, there was no mention of Michele Roosevelt Edwards or USAerospace Partners being part of a new carrier, to be called Italia Trasporta Aero, or ITA.
Is this for real?
Ever since, Michele Ballarin or Michele Roosevelt Edwards has made her share of claims about new projects and an impeding revolution on air travel, but nothing has materialised. The purple planes are nowhere to be seen. And in other media coverage of Michele's previous business ventures, it is clear that her ideas are often big, but the reality is small. Michele's closest collaborator in Iceland is the lawyer Páll Ágúst Ólafsson. Does he believe in Michele?
"Michele is real. Michele is a dynamic person. Has a strong vision. She truly has big dreams. And I have full faith in what she says and what she does. Otherwise I would not work for her,” he says in interview with Kveikur.
Kveikur sent Michele and her representatives a list of nine questions before this report was published, including how things went with the two jets in Miami, the scheduled flights to Iceland, the purchase of shares in Icelandair and more. Michele immediately responded and replied that she was not interested in answering Kveikur's questions.
“Several of your queries herein below are wholly inaccurate. As there is no positive outcome you are seeking in this tabloid effort, the questions will remain simply that: unanswered questions."
In the end, Kveikur did receive some written answers. Some using the frequent excuse, that all would be announced at the right time, and others explaining how COVID-19 had forced a change of plan.