Fraud Charged in Sales to Military

A Sun Valley company and its owner have been indicted on charges of selling the Army and Air Force substandard rotor pins for the workhorse UH-60 helicopter, which resulted in the temporary grounding of the fleet used to ferry troops and supplies into battle, federal prosecutors said Wednesday.

Jack Harootunian, 48, of Glendale faces up to 10 years in prison if convicted, and his company, Apex Manufacturing Inc., could be fined $1 million.

The problem came to light in 2000 when an Army medical unit in Hawaii reported that many of the pins in its UH-60 Blackhawk choppers were failing flight inspections because of corrosion and cracking.

Assistant U.S. Atty. Christine Adams, who is prosecuting the fraud case, said that no crashes or mishaps occurred because of any faulty pins.

Nevertheless, the two armed services were forced to ground their entire fleet of Sikorsky-built UH-60s for inspection so that Apex-supplied pins could be replaced, she said.

Harootunian’s attorney, Donald Etra, said the criminal charges are unfounded.

“All parts delivered to the government were believed to conform explicitly to specifications,” he said. “The documents from the company verify this.”

Etra said the military has shown its “full faith” in Harootunian by continuing to buy the same type of rotor pins from his company.

The pins are used to secure the helicopter’s four rotor blades to the main rotor.

Under its contract with the military, Apex was required to subject the pins to very high temperatures for sustained time periods, a process that increases hardness and resistance to corrosion.

The indictment charged that in July 1998, Harootunian shipped 3,467 rotor pins to the military without disclosing that an aluminum alloy component had not been heat-treated according to contract specifications.

He also was accused of shipping another 130 substandard pins to the military in September 1998.

When confronted about the problem two years later, the indictment said, Harootunian responded with a letter falsely claiming that the pins had been “tested and accepted per customer requirements.”

Apex Manufacturing was located in North Hollywood at the time the alleged offenses were committed. It now employs 14 people at its Sun Valley plant.

The UH-60 was designed to carry a crew of three and 11 troops or about 9,000 pounds of cargo. It can be modified for medevac or reconnaissance missions.

Since it introduced the aircraft in 1978, Sikorsky has built and sold about 2,500 of the choppers to all of the U.S. armed services and to American allies around the world. The Army has about 1,600 in its fleet.