The Counterfeit-Parts Game

Did you ever stop to wonder where you get spare parts for a 200-ton jet? When the mechanic stands on the ramp, watching Skydrol hydraulic fluid pour out of his spit-polished L-1011, where does he go to find a seven-dollar hydraulic fitting to get the beast aloft once more? The answer is not simple, but it is a clearly defined process. Air World Publications, for example, puts out a book called Military Standards. It contains drawings for certain types of parts. You take the part off the airplane and look at the numbers on it. Then you look up the numbers in that book. You'll find a drawing of the part and a decoding of the markings on the part, which tell such things as the type and strength of the material used in making it so that it won't melt or crack in flight. Listed there, also, is a "procurement specification." You look up the procurement spec and learn such things as the criteria of quality for the part. And then there is the Qualified Products List (Q.P.L.). That tells you which companies have been certified to make that part and sell it for installation on aircraft. It may look like an ordinary fitting you could buy in a hardware store--same size, same color, same threads. But it's not. It's special. It's supposed to fly.

After all that, you call one of the certified companies and it sends over the part. You are back in business. But of course, it doesn't always work that way. Documentary evidence, sworn testimony in court cases and numerous interviews with aircraft-parts makers and suppliers, as well as with police and Government officials, point to an industry-wide practice of supplying airlines, aircraft manufacturers and even the U. S. military with parts that are counterfeit, substandard, nonconforming, used or just plain scrap metal.

It does sound odd: Counterfeit a seven-dollar aircraft component? But it involves a viciously competitive business in which millions of dollars are at stake and in which profit margins can range into the 3000 percent bracket ("We buy fittings for aircraft by the carload," a Lockheed spokesman told me). I walked into Rockwell International and bought for $1.10 junk aircraft fittings that would sell for about $25 new. And the receipt I got tells the story: "Buy surplus 'As Is' Save $."

Apparently, this is a wide-open business. The only one left in the dark about it is the passenger. The FAA has an advisory circular stating:

Salvaged parts, appliances or components which have come from aircraft that have been involved in accidents, and rejected parts sold by the manufacturer as scrap metal, are available to industry as replacements. Such items may have been subjected to forces or environments which would render them permanently unairworthy.... It has come to our attention that many reproduced parts and components, particularly instruments which have been manufactured by persons other than the original manufacturers, are available for purchase and installation on U. S. certificated aircraft. Often, an original part is used as a sample to produce duplicates. The reproduced parts appear to be as good as the original part; however, there are many unknown factors to be considered that may not be readily apparent to the purchaser; i.e., heat treating, plating, inspections, tests and calibrations. All too often, the faulty part is not discovered until a malfunction or an accident occurs.

The word being side-stepped here is counterfeit. That's what it's called when samples are used to produce duplicates.

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United Supply is an aircraft-parts company near Los Angeles' Watts district. The following is sworn testimony from a court case involving a former United Supply employee, Peter Friedman. "During the period of my employment, it was the practice to stock both commercial fittings and aircraft fittings." By commercial fittings, Friedman means ordinary plumbing, such as you might buy in a hardware store. "Since many of these items are interchangeable, and since the differences, usually in metallurgical composition, cannot be detected by the naked eye, the Seattle division of Boeing Aircraft Corporation refused to deal with us because the paper certifications and warranties of conformity and compliance could not be supported due to the abundance of surplus aircraft fittings and industrial fittings in inventory.

"Shortly before I quit, I sold a substantial order to Dassault, in France [Dassault is one of the largest aircraft manufacturers in France and makes the Falcon jet and the Mirage fighter plane]. When I was at the Paris Air Show this year [1971], the administrative director of Dassault, Mr. André Simon, showed me the items shipped by [United Supply]. Instead of being newly manufactured fittings, [United Supply] had shipped used aircraft fittings."

In an interview, Friedman described the scene at the Paris Air Show. He thought he was representing a company that dealt in new, high-quality aircraft parts, and he fully expected United Supply to ship such parts to Dassault, a very distinguished firm with which one does not trifle. Simon and the grand heads of Dassault summoned Friedman to a table they had set up in the open air. They then emptied onto the table before him a container from the shipment he had sold them. It was an assortment of scrap metal--parts that had not even been dignified by a scrubbing. Some were covered with grease and still had the used rubber O rings on them.

Lockheed confirmed that United Supply was involved in counterfeiting parts made by a legitimate manufacturer, Globe Aerospace, as well as other manufacturers. A Lockheed spokesman described fittings that "had been altered or misrepresented. Logos had been changed and they were putting them on blanks beforehand. United Supply used this device to sell them." Harry Guss, owner of United Supply, hired a metal shop to make up raw stock with the Globe imprint on it. From that stock, United Supply manufactured a counterfeit part--but anyone buying it would see the Globe imprint and assume it was real. The part was identified as STSPB312F0606 and described by Friedman in sworn testimony as "a highly critical item...only a few companies are qualified to make this part and they are listed right on the Lockheed drawing." The part was being used on Lockheed aircraft. When asked to respond to those charges, Guss, reached by phone at his United Supply office, hung up.

The Los Angeles district attorney investigated the case. His file states:

According to FAA rules and regulations, no part, fitting or item may be used in the manufacture of an airplane unless [it] has been certified by its manufacturer as meeting certain standards; i.e., type and quality of material used, tolerances, heat treating, coatings or platings, inspections and packaging.... Supplier must furnish a certificate of certification. This certificate certifies that the supplier is able to certify that the purchased items meet either FAA or military standards. Any part that cannot be so certified cannot be legally installed on any airplane manufactured by a manufacturing company, regardless of its quality.

The muddled author of that is trying to say that parts have to come from qualified sources directly, no matter what the condition of the parts may be. Installing any other parts on aircraft is illegal.

Lockheed issued 168 separate purchase orders for the material, totaling $62,000--apparently, $18,000 more than it would have cost Lockheed to place its orders with Deutsch, the approved manufacturer of the parts, with whom Lockheed had a corporate purchase agreement. When Lockheed learned the parts were not qualified, it spent another $100,000 to test and inspect them.

In this case, the charges were never made formally, but there was a lot of questioning of how Lockheed buyers could be making purchases costing them an unnecessary $118,000. Ultimately, the D.A.'s suspicion of kickbacks to Lockheed buyers could not be proved and the case was closed September 11, 1973. Lockheed confirms the basic facts of the case, adding that today United Supply is still in business, is much larger and has actually obtained the Q.P.L. listing for certain parts. Lockheed refuses to do business with United Supply, even though that company continues to supply a large amount of hardware to the industry. Although Lockheed was reluctant to admit publicly that its buyers were involved as the D.A. suspected, it gave me this statement: "This improper procurement activity resulted in the dismissal of the two principal fitting buyers for cause." Incidentally, the parts in question were impounded. "We locked them up in a room," a Lockheed spokesman told me. Eventually, they were sent to the Lockheed labs for testing. "The parts were not found to be faulty." So they were used in building airplanes.

There are no figures on how widespread the bogus-parts phenomenon is. In fact, it is not even under investigation, as far as we know, though every source consulted on the matter in the Government, among manufacturers and within the airline companies agreed that it is a problem. In 1972, United Airlines was informed that it had been buying unqualified parts from Faber Enterprises and took its contract away from that company. As a spot check, we obtained sales records from Faber. They show that Faber was purchasing fittings from, among others, Essex, a manufacturer of commercial fittings. I called Essex and was assured that the company had never made fittings that could qualify for use on aircraft. A Faber spokesman denied knowledge of any such transactions, but Faber's records revealed sales to the following: Braniff International, American Airlines, KLM Royal Dutch Airlines, National Airlines, Western Airlines, Delta Air Lines, Bell Helicopter, Grumman, Douglas, Northrop, Sundstrand, Beech, Cessna, Piper and Boeing. The Boeing case is worth noting. Faber bought the parts listed on the sales record for 12 and a half cents each from "Boeing Lot"--presumably as scrap. Faber sold the parts to Boeing four months later for 30 cents each.