Nasa Loses $700 Million in Satellite Failure Due to Fraudulent Parts Certifications

An investigation by the U.S. Space Agency found that a metals manufacturer had provided hardware to Nasa backed by fraudulent test results. These materials eventually resulted in a loss of over $700 million, as well as multiple failed satellite launches. The company involved in the fraudulent materials scheme was an Oregon based company called Sapa Profiles Inc., which according to the investigation has falsified thousands of parts certifications throughout its nearly 20 years in business.

According to NASA, the faulty parts were used to surround a rocket named the Taurus XL, which was designed to deliver years of satellite research regarding the Earth’s climate. However, with the uncertified parts installed, the rocket was not able to break out of its encasement properly during launch. This effectively destroyed the project and resulted in several years of work and funding put to waste.

When testing results are altered and certifications are provided falsely, missions fail,” stated the director of launch services for NASA, Jim Norman. However, the Taurus XL was not the only equipment ruined by the faulty hardware provided by Sapa Profiles Inc.

In 2009, the OCO, also known as the Orbiting Carbon Observatory, was unable to properly launch into the atmosphere and never reached orbit. This structure was designed to study the levels of carbon dioxide present in the Earth’s atmosphere but represents yet another structure wasted by fraudulent certifications. A similar case occurred with the Glory Satellite, which also failed to reach orbit upon launching.

When news of the satellite failures began to be investigated, the parent company of Sapa Profiles Inc. offered to pay a settlement of $46 million for fraudulent activities that dated back to the late 90s and as recently as 2015. The company admitted to falsifying test results that involved the strength of the materials when under pressure. Sapa Profiles later plead guilty to one count of mail fraud, resulting in a lifetime ban from participating in any government contracting with the United States.

According to a spokesperson for the company, Sapa Profiles Inc. is making significant changes to the quality of their products and integrity of their certification processes to ensure that this situation does not happen again. The company also filed for a name change and is now known as Hydro Extrusion Portland Inc.

To learn more about similar cases and various forms of fraud, visit the Newman & Shapiro Whistleblower Help Center and blog!