FBI Investigation of Thiokol Prompted by Fraud Allegations

Substantial allegations of fraud, made secretly to FBI agents in Salt Lake City by employees of space shuttle rocket maker Morton Thiokol Inc. earlier this year, have resulted in a federal investigation of the Utah-based aerospace company, according to previously sealed documents released Thursday in U.S. District Court.

The newly opened records also reveal claims by Roger Boisjoly, one of the rocket engineers who argued to delay the launch of the space shuttle Challenger, that Thiokol failed to hire quality control and safety personnel funded by the National Aeronautics and Space Administration, using the money instead, he said, “as a slush fund for Thiokol.”

In a telephone interview Thursday, Boisjoly said his “slush fund” term was a “figure of speech” and he had no idea what the company did with the money.

‘Another Pile of Money’

“It wasn’t used for full-time quality control. It was just another pile of money they could dip into,” said the engineer who is on a disability leave from his job at Thiokol’s Brigham City plant.

Boisjoly is suing Thiokol on his own behalf and that of U.S. taxpayers, alleging that the maker of shuttle solid rocket boosters falsely certified the safety of the O-ring seals that investigators say failed on Jan. 28, 1986, and resulted in the Challenger’s explosion, which killed the seven crew members. The documents opened Thursday were filed earlier this month in that suit.

Company officials could not be reached for comment Thursday, but in a statement released earlier this month Thiokol called Boisjoly’s charges “false and without justification.”

In the documents, Boisjoly charged that engineers at Thiokol knew in February or March of 1985 that the rubbery O-rings did not function properly at temperatures of 50 degrees but that company management kept that information from NASA for about four months, demonstrating a lack of candor.

Boisjoly also said that a memorandum he wrote warning of the potential for catastrophe in a cold weather launch was immediately classified “company private” and withheld from NASA.

Unsealed by Accident

The documents, including the transcript of a private conference between U.S. District Judge Harold H. Greene and Justice Department attorneys last month, were released after attorneys for Thiokol pressed to see them. The company contended it needed the material to answer news media inquiries that arose after a transcript was accidentally unsealed by court clerks recently.

The Justice Department attorneys told Greene on March 11 that the federal investigation began before the Boisjoly suit was filed and was being coordinated out of headquarters in Washington.

“It is viewed by the (FBI) to be an extremely sensitive investigation,” said Justice Department lawyer David W. Long in the transcript. He said he was concerned that the investigation was in a very early stage and could be jeopardized by premature disclosure of related fraud allegations contained in Boisjoly’s suit.

Long told the judge that the FBI had “informants inside the company,” but no further detail was given.