United States Indicts Four in Alleged Aircraft Parts Scheme

June 30, 2022 by Leave a comment

The United States has indicted four people for fraud related to aircraft parts transactions. The indictment alleges that an air carrier employee directed aircraft parts transactions to the other defendants in exchange for kickbacks.

According to the indictment, the air carrier employee would text a part number and a “price ceiling” to the other defendants, and then the defendants would know to quote below or at the price ceiling in order to win the business. The indictment alleges that a percentage of the parts sales was paid as a kickback to the air carrier employee.

The government has accused the defendants of conspiracy to commit fraud (in that the air carrier was denied the honest services of its employee) as well as wire fraud (18 U.S.C. 1343) for using wire services to transmit the proceeds of the scheme.

The indictment names four individuals, bu not their companies, as defendants. It is important to remember that an indictment is just the government’s allegations. These factual allegations have not yet been tested against the defendants’ stories, and the actual facts adduced at trial could differ substantially from the facts alleged in the indictment.

Regardless of the facts of this matter, the matter illustrates the importance of having corporate rules that prevent buyers from taking things of substantial value from seller, and corporate rules that prevent sales agents from providing undisclosed gifts or kickbacks to buyers. If you think that a transaction could be characterized as unethical or as unfair, or if you identify any other red flags, then it is always best to consult with an attorney to ensure that the transaction does not violate any laws.

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Airworthiness Fraud Indictment Names Management and Employees from Repair Station “Aircraft Transparencies Repair” (ATR)

March 29, 2012 by Leave a comment

The South Florida Business Journal reports that the FBI has released a 21-count indictment charging 16 individuals with criminal activity related to Hialeah-based repair station Aircraft Transparencies Repair.

The article indicates that the facility was operating as an unlicensed repair station even though they had told federal officials they were closed.  The article also states that the the indictment claims that “the defendants also created false records to make it appear to the Federal Aviation Administration that the company was no longer repairing aircraft windows.  Some of the defendants are alleged to have filed false unemployment compensation requests to further the illusion that ATR was out of business.”

The Justice Department Press Release states:

According to the indictment, between August 2009 and August 2010, the defendants falsely certified to commercial aviation customers that the aircraft cockpit windows they sold were airworthy. In fact, however, the defendants knew that they were not authorized by the FAA to certify the airworthiness of aircraft cockpit windows. To execute their scheme, the defendants purchased “as removed” aircraft cockpit windows in the open market and then backdated numerous documents, including FAA Form 8130-3’s, work orders, and traceability documentation, to make it appear that the aircraft cockpit windows had been retrieved from ATR’s inventory while its FAA Repair Station Certificate was still valid. As well, the defendants allegedly altered the serial numbers on the aircraft cockpit windows that had been sent to ATR by the commercial aviation customers to make it appear that the aircraft cockpit windows had come from inventory rather than from the true commercial aviation customers.

Court documents in this matter are filed at the District Court for the Southern District of Florida.

Any company that has had windows repaired by this repair station may wish to examine whether the repair were completed properly and legally.

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