NASA employees implicated in fraud investigation



SPACE CENTER, Houston (AP)—About a half-dozen NASA employees and up to 24 workers from outside the agency were implicated in a federal fraud investigation, a government official said Thursday.

The investigation, an FBI sting dubbed Operation Lightning Strike, netted evidence that NASA employees and contractors took kickbacks and bribes and sold inside information, the official said.

Johnson Space Center spokesman Harold S. Stall said officials were told about the investigation by the National Aeronautics and Space Administration’s inspector general on Wednesday.

‘‘We are cooperating fully,’‘ Stall said.

Both the FBI and the U.S. attorney’s office in Houston refused to comment on the sting.

The government official told The Associated Press that the investigation implicated six or seven NASA employees, 12 to 24 non-NASA employees, and a couple of corporations. The official spoke on condition of anonymity.

Discussions were being held with some of the targets to resolve the matter through pleas, the official said.

The investigation was active until news organizations publicized the probe this week, the source told the AP.

A FBI agent posing as a wealthy businessman peddled a fake medical device—one that supposedly would cure kidney stones without surgery—to people within NASA, according to reports by two Houston television stations and NBC News. The reports cited anonymous sources.

The agent told NASA workers he wanted the space agency’s endorsement and the device flown aboard the shuttle to increase its worth, KHOU-TV reported.

He then paid a contractor in the Life Sciences Projects Division and a NASA technical manager to say the machine was real even though they knew it was not, according to the report.

The investigation caught at least two major aerospace companies offering bribes and kickbacks for inside information on the project, KHOU said, adding that an unidentified astronaut also was implicated.

The investigation’s results were turned over to the U.S. attorney’s office in Houston and the contractor and technical manager involved have agreed to cooperate with prosecutors.

NBC reported Thursday that two people implicated were employees of General Electric’s space division, which has since been sold to Martin Marietta Corp.

An unidentified source told the network that Martin Marietta has fired one of the workers and the other has left the company.

Martin Marietta Corp. spokesman Neal Linkon told the AP on Thursday that the company was not involved in the sting, but added, ‘‘We are cooperating fully with the government as far as general procurement practices at Johnson Space Center.’‘

NASA and Johnson Space Center in particular have come under heavy scrutiny this year for cost overruns and contract abuse. In one instance, the sprawling Houston complex was blamed for $1 billion in overruns for space station contracts it oversees.

‘‘Unfortunately, NASA’s dismal record … may have opened the door for these kinds of improprieties,’‘ said Rep. John Conyers, D-Mich., chairman of the House Government Operations Committee.

Conyers’ committee in October heard testimony from NASA Inspector General Bill Colvin that the agency is plagued with abuse, including contractor overcharges and contracts that are awarded non-competitively. He added that NASA had more than 400 criminal fraud investigations already under way.

Rep. Ralph Hall, D-Texas, chairman of the Science, Space and Technology Committee’s panel on space, said he would ask for hearings on the matter when Congress reconvenes in January.

But he urged the Justice Department to make the investigation public so a pall is not unnecessarily cast over all of NASA.

Word of the FBI sting came at the start of the most important shuttle mission ever—Endeavour’s 11-day flight to repair the Hubble Space Telescope. NASA hopes mission success will restore its tarnished image.

‘‘The story and the timing of the thing is obviously very disappointing,’‘ Stall said. ‘‘I think we have to wait and see what the facts of this thing are before we jump to any conclusion.’‘