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Nasa Says Metals Fraud Caused $700M Satellite Failure

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Re: Nasa Says Metals Fraud Caused $700M Satellite Failure

#131

Post by CharlesColeman »

gnode wrote: post #104
JohnGB wrote: post #83

Why wouldn't the QC at NASA include testing at independent labs for anything mission critical? That seems like a failure on NASA's part as much as it is fraud by the supplier.

It may be that actually fully stressing the parts is avoided, as it may risk weakening the part. I've heard of various non destructive testing methods being used to check the integrity of metals in aerospace, such as ultrasound and radiography. This may well be enough if the part is actually made of what it's supposed to be.

> It may be that actually fully stressing the parts is avoided, as it may risk weakening the part.

Couldn't they just buy an extra and destructively test that?

Re: Nasa Says Metals Fraud Caused $700M Satellite Failure

#132

Post by nerdponx »

godzillabrennus wrote: post #122
nerdponx wrote: post #116

Earlier quoted context omitted.

Frankly I don't see why being a member of a corporation should protect an individual from criminal charges. If you do or authorize something illegal on behalf of your company, you should be personally responsible. I know it's a long-standing doctrine in law and there is probably a good reason for it, but it just seems too easy to abuse.

What if you don’t know that your actions are illegal? Who could reasonably do a job as an employee if they didn’t have that liability shield? The justice system is broken enough in the USA (unless you are rich) that I can’t imagine introducing more issues.

What if you don’t know that your actions are illegal? Who could reasonably do a job as an employee if they didn’t have that liability shield?

This isn't an excuse for private citizens, so why should it be an excuse as an employee?

That said, we should propagate responsibility as high as possible. If you are a rank-and-file employee and your manager is asking you to do something illegal, unless you have enough professional autonomy to decline the request without being fired then your manager is responsible, not you.

Re: Nasa Says Metals Fraud Caused $700M Satellite Failure

#133

Post by gnode »

abakker wrote: post #99
gnode wrote: post #92

Earlier quoted context omitted.

> it’s shocking nobody is going to jail in relation to a fraud guilty plea. They are though. From the justice.gov article: "Dennis Balius, the SPI testing lab supervisor, led a scheme to alter tests within SPI’s computerized systems and provide false certifications with the altered results to customers. Balius also instructed employees to violate other testing standards, such as increasing the speed of the testing ma…

>because it isn't a human. This is especially interesting in the context of corporate personhood[1]. You can't send a corporation to jail, but you can disband it entirely, or prevent it from operating. A lot of the practical solutions try to leave badly behaving company operating, though, since if we shut them down there is a lot of collateral damage in the form of lost productivity in the economy and lost jobs. IANA…

> As I understand it, if a company actually goes to trial and is convicted, they are not allowed to operate anymore, hence the plea deals and fines.

This isn't true (a counterexample: https://www.justice.gov/usao-ndca/pr/pge-found-guilty-obstru... ). The reason for plea deals is that neither prosecutors nor defendants typically want to go to court and have a jury trial with an essentially random high-stakes outcome. Both sides usually want to reach an acceptable compromise.

Disbandment also means very little from a punitive perspective, unless you consider disbandment to include seizure of the company's assets. Disbandment is unfavourable because it destroys the value embodied by the company's association: it's customer relationships / brand value, its employee relationships, etc. The cases where disbandment or breakup makes sense are where that association is bad for the rest of society, such as monopolies (e.g. AT&T's antitrust settlement https://en.wikipedia.org/wiki/United_States_v._AT%26T)

Re: Nasa Says Metals Fraud Caused $700M Satellite Failure

#134

Post by nerdponx »

shkkmo wrote: post #123
nerdponx wrote: post #117

Earlier quoted context omitted.

I fully support this. If you, a manager, are aware of illegal activity within your organization and do not take steps to stop it, you are as responsible as the individuals doing the illegal activity.

I think more than that is required. I think that they should be held liable even if they do not know. I think it should be their responsibility to to find out and to design corporate structures that don't incentive and conceal illegal activity by their subordinates.

That's fair, although at a certain point (e.g. international holding company with several large subsidiaries) it becomes impossible to police every activity by every department of every subsidiary.

Re: Nasa Says Metals Fraud Caused $700M Satellite Failure

#135

Post by mruts »

brianpgordon wrote: post #115
chias wrote: post #107

Earlier quoted context omitted.

> There's intense political pressure to not punish shareholders for management's misdeeds Rightly so, IMO. I invest almost exclusively in index funds, which means there's a good chance I'm a shareholder and don't even know it. I like to think that it wouldn't make sense for me to be held responsible.

The reason your index funds return so much is that you're buying a share of ownership in the company. That includes upside but it also includes downside. If there were no downside you'd be getting exactly money market-like returns.

The downside of equities is not being sued as a shareholder of a crooked company, it's the risk and long-term exposure you bear from your share of ownership and the future cash flow of the company.

Re: Nasa Says Metals Fraud Caused $700M Satellite Failure

#136

Post by nerdponx »

abakker wrote: post #130
nerdponx wrote: post #116

Earlier quoted context omitted.

Frankly I don't see why being a member of a corporation should protect an individual from criminal charges. If you do or authorize something illegal on behalf of your company, you should be personally responsible. I know it's a long-standing doctrine in law and there is probably a good reason for it, but it just seems too easy to abuse.

Well...it doesn't. Members of corporations absolutely can be and are convicted of crimes. The issue is really whether corporation itself, as a legal "person" can be convicted, and if so, what does that actually mean, legally?

The issue is really whether corporation itself, as a legal "person" can be convicted, and if so, what does that actually mean, legally?

It wouldn't be up for debate if responsible entities at corporations were actually held responsible for their actions. Corporate personhood is a smokescreen in this case.

Re: Nasa Says Metals Fraud Caused $700M Satellite Failure

#137

Post by shereadsthenews »

will4274 wrote: post #120
shereadsthenews wrote: post #86

Earlier quoted context omitted.

As a blanket statement this is incorrect. Many common law jurisdictions permit private prosecution of criminal cases.

> many Isn't it basically just the UK?

Only if you think Canada and various American states are in the UK.

Re: Nasa Says Metals Fraud Caused $700M Satellite Failure

#139

Post by moftz »

ethagknight wrote: post #89
JohnGB wrote: post #83

Why wouldn't the QC at NASA include testing at independent labs for anything mission critical? That seems like a failure on NASA's part as much as it is fraud by the supplier.

This is what I am wondering. In construction, we have third party testing of every major material in use, like daily concrete testing for new pours, weld inspections on steel, graded lumber, etc. hard to believe that NASA didn’t test their aluminum for a decade.

It was material that went into a frangible rail built by one company for a fairing built by another company, integrated into a rocket built by yet another company. Where would NASA have the time to test each and every bit of material going into the many-tiered parts of the design? NASA is relying on the prime contractor to make sure their vendors are on the up and up. The prime is making sure their vendors do their due diligence as well. The failure in this chain of trust comes about when someone is blatantly lying about results. The lab manager was instructing his technicians to lie about results and also speed up testing equipment between customer visits.

Testing everything yourself works out well since you are receiving most of the raw material and doing the assembly either yourself or on site with a contractor. NASA doesn't built a lot of stuff themselves. Components can be so deep in levels of subcontracting that all NASA can do is just make sure everyone is adhering to proper engineering and manufacturing principles. The company that originally bought the aluminum I'm sure tested all of their finished components the right way but testing might not have been sufficient enough against how much stress the part is actually under during flight. Or testing weakened the part to the point where a failure was imminent but not obvious. Or the vendor doesn't really test their stuff extensively and relies on the customer to handle that. Either way, the part passes tests and gets sent to the customer where the they would integrate the part into their design and test it as well. Or not fully test it based on the idea that the next customer would test it. Who knows? Maybe they didn't test it hard enough or maybe it was most of a length of testing problem. The point is that NASA has neither the time or money to independently test parts and materials, they rely on their experienced contractors and subcontractors to do it.

If there isn't already, there needs to be some additional laws with government contractors to make sure those in a position of trust (like test lab technicians and their managers) receive no compensation based on whether or not material passes inspection or how much they test. Or force these kinds of labs to do independent 3rd party testing.

Re: Nasa Says Metals Fraud Caused $700M Satellite Failure

#140

Post by moftz »

zackmorris wrote: post #85

As Nasa is a government agency, I wonder if lack of regulation and oversight played a hand in this. This sort of scenario is exactly why I'm concerned about the recent trend towards rampant free market economics and libertarianism. Those ideas have merit in certain situations, but also increase risk to the public as witnessed here by losses that are proportionately much higher than any efficiency savings. I'm also co…

NASA has a ton of regulation and oversight that their contractors abide by. However, if you are in a trusted position of testing materials and not only you but your entire lab is compromised by cheating, how is anyone going to really find out unless someone speaks up? They were speeding up the test equipment between customer visits of the lab. This wasn't just laziness or someone fudging the numbers because its close enough, this was straight up fraud. NASA can't afford to test every little bit of everything that goes into a rocket themselves. They rely on their contractors to do their due diligence and make sure their vendors do everything right. Maybe a lot of stuff slipped past. There's probably bits of deficient aluminum all over the place but it held up enough during testing so no one noticed.
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