A half-dozen Southland men face federal charges stemming from an alleged scheme to pay kickbacks to a procurement official at a subsidiary of the Boeing Co. that supplies satellites and satellite parts to government entities, including NASA, the U.S. Attorney’s Office announced Thursday.
Federal prosecutors made the announcement after a judge in Los Angeles unsealed documents related to four of the defendants, who previously pleaded guilty in proceedings that were closed to the public.
At the center of the alleged scheme is an executive at a San Gabriel Valley metal company that was a subcontractor to Boeing Space and Intelligence Systems, which supplies satellites and satellite parts to NASA, the Department of Defense, the National Reconnaissance Office and the United States Air Force, according to prosecutors.
Alfred Henderson, 60, of Pico Rivera — vice president of A&A Fabrication and Polishing Inc., which operates in Whittier and Montebello and was itself also charged — was arrested Monday and arraigned on a 15-count grand jury indictment that was unsealed after his arrest.
Henderson pleaded not guilty and was released on a $25,000 bond pending trial on May 26.
Representatives of A&A are expected to appear on behalf of the company in court on April 13.
A&A, which specializes in machining, welding and producing sheet metal for industries that include aerospace, also manufactured tooling parts that Boeing used to manufacture satellites, according to the U.S. Attorney’s Office.
The indictment alleges that Henderson and A&A paid kickbacks to Mark Allen, 60, of Fresno, a procurement officer at BSIS in El Segundo.
The kickbacks that were paid to Allen through outside sales representative Raymond Joseph, 66, of Los Angeles, related to purchase orders to A&A for tooling parts used to manufacture of satellites that were sold to the federal government, prosecutors allege.
Allen provided Henderson with confidential information that gave A&A an improper advantage in bidding and ensured that A&A would receive purchase orders from BSIS, the indictment alleges.
Prosecutors contend that Allen awarded A&A about $4.5 million in BSIS purchase orders between 2005 and February 2012.
As part of the conspiracy, Henderson and A&A paid nearly $650,000 to Joseph and about $100,000 to Allen, the U.S. Attorney’s Office alleges.
Federal prosecutors also allege that, after Boeing decided to stop doing business with A&A due to work quality and performance issues, Henderson devised a scheme to do business through a “front” company, Nace Sheet Metal Co., which was owned and operated by Cesar Soto, 47, of Chino.
The indictment against Henderson alleges that Soto and an A&A employee, Randy Mitchell, 62, of Whittier, misrepresented that A&A’s facility was actually operated by Nace and that Henderson unlawfully used Soto’s name on price quotes to Boeing.
The indictment further alleges that Henderson and A&A issued false tax forms to Joseph, which he used to understate his taxable income to the Internal Revenue Service.
“Pay-to-play schemes undermine the integrity of the competitive bidding process and, in this case, compromised the quality of products used to manufacture satellites for scientific exploration and national defense,” said Acting U.S. Attorney Stephanie Yonekura.
Chris D. Hendrickson, special agent in charge of the Defense Criminal Investigative Service, said corruption in government contracting is “always reprehensible” and the indictment and arrest of Henderson illustrates the agency’s determination to “identify and prosecute those individuals who engage in corrupt business practices.”
In a court order filed late Tuesday, U.S. District Judge Otis D. Wright II unsealed criminal cases against Allen, Joseph, Soto and Mitchell. All four previously pleaded guilty and are awaiting sentencing.
The U.S. Attorney’s Office on Monday filed a criminal information against a seventh defendant — Noberto Martinez, 53, of Alhambra, who owns and controls Zenitram Engineering and Manufacturing Inc.
The information charges Martinez with conspiring to pay kickbacks to Allen and issuing false tax forms to Joseph.
Martinez has signed a plea agreement and is scheduled to make his first court appearance on April 13, federal prosecutors said.
— City News Service