NASA Says Oregon Company Metals Fraud Caused $700 Million Satellite Failure - 2019

Marc

Hunkered Down for the Duration
Staff member
Admin
#1
A metals manufacturer faked test results and provided faulty materials to NASA, causing more than $700 million in losses and two failed satellite launch missions, according to an investigation by the U.S. space agency. From a report: The fraud involved an Oregon company called Sapa Profiles, which falsified thousands of certifications for aluminum parts over 19 years for hundreds of customers, including NASA. The bad parts were used in the making of Taurus XL, a rocket that was supposed to deliver satellites studying the Earth's climate during missions carried out in 2009 and 2011. The launch vehicle's fairing, a clamshell structure that carries the satellite as it travels through the atmosphere, didn't fully open, causing the unsuccessful launch, according to a statement from NASA.
 
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Pancho

wikineer
Super Moderator
#2
Wow! Falsified thousand of certs, caused $700M in losses to just NASA and they paid only $46M to “resolve criminal charges and civil claims”? Claims stemming from fraud? That does not make sense. There’s no limit to liability stemming from fraud.

The mess doesn’t surprise me though. We buy aluminum and we ALWAYS test coupons, hardness, etc., before use in structural applications. Certs are too often wrong. Never thought it nefarious, though.
 

Sidney Vianna

Post Responsibly
Staff member
Admin
#3
There have been a large number of counterfeit products and certificates affecting the aerospace supply chain. And that is the main reason why the requirement for periodic validation of material certs was reintroduced in the AS9100 standard.
 

Marc

Hunkered Down for the Duration
Staff member
Admin
#4
...caused $700M in losses to just NASA and they paid only $46M to “resolve criminal charges and civil claims”...
This is so common in many (all?) fields that I would think very, very few people would be surprised. And it almost always ends with a "settlement" with "...no admission of wrong-doing...". Heck, look back to the 2007-2008 financial crisis where the US citizens, for all intents and purposes, bailed out the banks.

Fraud is more prevalent than most people think and when found out the more $$$ involved the less likely that anything will come of it.

The old saying: “If you owe a bank thousands, you have a problem; owe a bank millions, the bank has a problem”
See: The Big Apple: “If you owe a bank thousands, you have a problem; owe a bank millions, the bank has a problem”
 

optomist1

A Sea of Statistics
Trusted Information Resource
#5
...in any field a firm is only good as its weakest link....this "frequently" translates to a manager/senior manager leading the charge towards exponential growth and profits...re: Fraud Street 2008....in the words of Lloyd Blankfein....roughly quoted...."we/Goldman et al are doing God's work...."

Wasn't Kobe Metals?? doing something similar 2017??
 

Pancho

wikineer
Super Moderator
#7
There have been a large number of counterfeit products and certificates affecting the aerospace supply chain. And that is the main reason why the requirement for periodic validation of material certs was reintroduced in the AS9100 standard.
Seems like something a good QMS would "learn" quickly. Aluminum mechanical properties can be easily, inexpensively and non-destructively validated with hardness testing. It is surprising and disappointing that NASA wouldn't have such validation in their system. The story says that this went on for decades! No discrepant certs were spotted in all that time? Corrective actions were not validated? Perhaps the low settlement reflects buyers' negligence too?
 

Michael_M

Trusted Information Resource
#10
After the Kobi Steel incident, two of our customers started requiring full secondary testing. We ended up buying an XRF Analyzer (X-ray fluorescence) that we use to scan all material for Aerospace. After a year of having this, we have only rejected one shipment of material (Aluminum Nickle Bronze) for failing the secondary test.
 
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