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Justice News

Department of Justice
U.S. Attorney’s Office
Central District of California

FOR IMMEDIATE RELEASE
Tuesday, August 1, 2017

Orange County Man Pleads Guilty to Federal Charge of Failing to Properly Overhaul Part Used on Apache Helicopters

Owner of Gardena Company also has Agreed to Pay more than $900,000 to Resolve Parallel Civil Investigation

          LOS ANGELES – A Yorba Linda man who owns a Gardena company that contracted with the U.S. Army to overhaul linear actuators used on Apache helicopters pleaded guilty to violating his contract with the military by making unauthorized repairs to motors inside the part.

          Bahram Bordbar, 62, the owner of Prototype Engineering and Manufacturing, Inc., pleaded guilty today to a federal charge of making false statements involving aircraft. Bordbar admitted that his fraudulent conduct led to him improperly receiving approximately $320,000 from the Army.

          Prototype had a contract to overhaul and repair linear actuators that were used on the Army’s AH-64-A Apache helicopter. Prototype was not authorized to repair DC motors used in the linear actuators unless the company received specific authorization from the Army.

          According to a plea agreement filed in United States District Court, Prototype used an outside contractor to repair 105 DC motors when those repairs had not been approved by the military. Those repaired motors were installed into overhauled linear actuators which were delivered to the Army.

          Bordbar also pleaded guilty to one count of aiding and abetting in the filing of a false tax return related to an employee’s tax return. Bordbar paid the employee $100,000, but told the employee the money was a gift and that he would pay the taxes, which prompted the employee to not report the money as income on a federal tax return. Bordbar has agreed to pay the Internal Revenue Service more than $28,000 to pay the employee’s back taxes.

          Bordbar pleaded guilty before United States District Judge John F. Walter, who is scheduled to sentence the defendant on October 16. At sentencing, Bordbar will face a statutory maximum sentence of 13 years in federal prison.

          In a parallel civil investigation under the False Claims Act, Bordbar in June agreed to pay over $900,000 after the government determined that he had caused Prototype to submit false claims to the U.S. Army. The civil investigation found that, in addition to improperly installing repaired DC motors, Prototype also installed cheaper replicas of a jacket-and-nut assembly component, rather than purchasing that component from the original manufacturer. As part of the civil settlement, Prototype agreed to cease doing business and dissolve, and Bordbar agreed that he will no longer solicit, accept or perform any federal government or military contract.

          This case was investigated by the Department of Defense, Office of Inspector General, Defense Criminal Investigative Service; the U.S. Army Criminal Investigation Command; the Federal Bureau of Investigation; and IRS Criminal Investigation.

          The criminal case was handled by the Major Frauds Section. The civil settlement was handled by Assistant United States Attorney Donald W. Yoo of the Civil Fraud Section.

Contact: 
Thom Mrozek Spokesperson/Public Affairs Officer United States Attorney’s Office Central District of California (Los Angeles) 213-894-6947
Press Release Number: 
17-144
Updated December 28, 2017