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Aerometals Is Acquitted in Parts Case

The defense contractor and its co-owners had been accused of selling to the military used components as new.

August 12, 2003|From Associated Press

A Sacramento-area defense contractor and its co-owners have been acquitted of federal charges that they sold hundreds of used parts to the military that were unknowingly used in special forces helicopters and Air Force jets.

Aerometals Inc. of El Dorado Hills was indicted in May on allegations it obtained surplus parts and sold them to the government as new.

Prosecutors said the company could have, but did not, seek permission to provide surplus parts under the contracts valued at more than $3.57 million.

A federal jury disagreed Thursday, finding the company and co-owners Rex Kamphefner and Guy Icenogle not guilty on all charges.

The company said everything it supplied was "new" under the terms of its federal contract, though the contract had several interpretations for what constituted a new part. The parts were "new surplus" -- unused, but purchased commercially or from the government instead of from the original manufacturer. And the government had approved the parts for such use.

The company had two contracts with the Department of Defense's Tampa, Fla.-based Special Operations Command in 2000 and 2001. Aerometals supplied about 443 parts for the MD500 Series helicopters at a cost of about $1.78 million and about 194 parts for about $1.79 million for the Mission Enhanced Little Bird modified version of the MD500, the indictment said.

It also had a 2000 contract with the Defense Supply Center in Richmond, Va., to supply three new rudder mechanisms for the Air Force's KC-135 aerial refueling jets. The indictment alleged that the company cleaned and repainted used mechanisms to look new before selling them to the government.

The indictment followed an investigation by the U.S. Army Criminal Investigation Command, the Defense Criminal Investigative Service and the U.S. Air Force Office of Special Investigations.

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