According to a report, Federal Aviation Administration officials are set to levy a record penalty of $25 million on American Airlines for improper maintenance, resulting cancellation of flights in 2008.

The fine is being imposed due to improper electrical wiring across the landing gear of its nearly 300 McDonnell Douglas MD-80-series jets, which cause entire fleet to land in April 2008.

The FAA officials are in the view that the wiring problem could have cause fire and fuel-tank explosions.

Nearly 3,000 American flights were canceled, which had cost loss of tens of millions of dollars to the airline in terms of lost ticket sales.

But the Fort Worth-based American Airline defended itself by stating it a minor problem of improperly spaced clips that held bunches of wires together.

American spokesman, Tim Smith stated that, "This is something that happened more than two years ago, and we haven't received any notification by the FAA about any pending action, nor do we believe any action is warranted."

American Airline, however, could challenge the penalty so imposed and negotiate with the Federal official to reduce the amount of fine.