Your question is very open ended, but I would like to try and explain how a CFI is responsible.
We need to separate the accident at mechanical or pilot error. If something happened to the aircraft say fuel, engine, or mechanical the FAA will be able to fine out, there is always witness marks that will give clues. If it is something that should of be found on an pre-flight check list then the pilot will be at fault and maybe the CFI. This depends on the students training. Lets assume the mechanical part of the aircraft is found good and the student does freeze up. The FAA has a set of Orders to follow when it comes to accidents and the CFI is always looked at.
First, the FAA objective is to determine whether a Certificated Flight Instructor (CFI) continues to perform to the same standards as for original certification. A high activity CFI is one who recommends at least four applicants annually for a practical test.
Since the flight instructor has a responsibility for aviation safety, an FAA inspector's contacts with the flight instructor to provide an opportunity to discuss current regulations, procedures, and techniques for the instructor to use in fulfilling that responsibility. This will be documented in the CFI official record at Oklahoma City.
Second, there are many circumstances that may result in an inspector initiating the surveillance of a flight instructor. For example, an inspector may initiate surveillance because of observations made during a pilot school inspection. A flight instructor maybe subject to an inspection during an inspector's random visit to an airport, or as a result of that instructor's visit to a Flight Standards District Office (FSDO). An instructor may be subject to surveillance because of an accident, an incident, or if deficiencies in the instructor's students become apparent. High activity CFI's should be inspected when applicant failure rates of 30 percent or greater are observed.
Third, areas that are clearly deficient, revealed either in the instructor's actual performance or in a student's performance, could make the instructor subject to a re-examination or possible enforcement investigation. Consult Handbook Order 8700.1 Volume 2, Chapter 26 or Chapter 182.
Having said all that can a CFI be held responsible for a death of a student on their solo flight. The answer is maybe. First two questions have to be answered, could the CFI known or should of known if the student would freeze up and stall the aircraft.
Since we are talking accident with a death the CFI will be called in and asked to provide all his training records and all the students records. Was the student properly trained? Were they ready for a solo flight or did they just meet the minimum hour requirement? Should the CFI of known the student would freeze up? Certainly the CFI will be held responsible and his judgment will be called into question as stated above since 99% of all airplane accidents is pilot related.
Remember the FAA or NTSB is the least of the CFI’s worries, any lawyer will certainly go after the CFI, the training school/club, and aircraft owner for civil damages. The FAA may take the CFI’s certificates for a period of time, but the CFI will probably recover in time. But, it will stay on his permanent record and an airline career is out of the question, since they do check pilot accident records. If you have an accident on your record the airline will not take the risk of allowing you to fly for them. And of course your insurance will go up as your are now a liability.
During an investigation of a accident the CFI’s pass fail record, number of students, FAA surveillance, type of activity is all look at and patterns form. The FAA keeps records of all of this in there data base and any good lawyer will use the Freedom of Information Act (FOIA) to obtain the CFI’s data. And in a court of law use any and all FAA data against the CFI. Remember the flight instructor has a responsibility for aviation safety and their students.
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