U.S. Agents Raid Local Aerospace Company

Capping a six-month investigation, federal agents Thursday raided the offices of a local aerospace company suspected of selling counterfeit engine parts used in commercial and military airplanes.

Signal Aerospace--a firm allegedly run by a convicted arms dealer--is suspected of selling jet-engine parts that were not certified by the Federal Aviation Administration. The company denies any wrongdoing.

Such FAA certification is required to ensure that aircraft parts meet federal safety regulations. Authorities fear the use of unapproved parts could result in engine failure and possible loss of life.

“It’s an ongoing investigation--a joint investigation by the Department of Transportation, the FBI and the FAA into allegations concerning the distribution of counterfeit aircraft parts,” FBI spokesman John Hoos said.

On Thursday, two dozen federal agents working with the multi-agency task force searched the company’s Ventura offices and an adjacent warehouse.

At the same time, another dozen agents served a warrant at the Spanish Hills home of company President Susanne Stehr in Camarillo.

Stehr’s husband and business partner, Arif Durrani, is a convicted arms dealer suspected of leaving the country earlier this year amid a separate investigation by U.S. Customs Service officials.

Durrani, a Pakistani national, was convicted in 1987 of illegally exporting missile parts to Iran. He was sentenced to 10 years in prison and fined $2 million.

At the time, he claimed to be involved in the Reagan Administration’s secret arms deals with Iran, and said he had once met with Oliver North. Durrani was released from prison in 1992.

Durrani left the United States in February, a move authorities suspect came in anticipation of being deported.

According to a search warrant affidavit filed in U.S. District Court in Los Angeles on Wednesday, Durrani is prohibited from exporting certain aircraft parts to some countries.

Phone records from earlier this year showed calls to various foreign consulates in Los Angeles, including Costa Rica, Mexico and France.

Customs officials interviewed during the task force’s probe say they believe Durrani was actually running Signal, though his wife is listed in state documents as the owner and operator.

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On Thursday morning, more than two dozen federal agents arrived in vans and unmarked cars outside Signal’s offices in a small gray industrial park. Agents were still removing boxes of documents by late afternoon.

It was unclear how many employees were inside the offices when agents arrived, but witnesses said Stehr pulled up at about 1 p.m. in a red BMW.

“I’m glad they’re here. My name will be cleared because I have nothing to hide and they will see that,” Stehr told a Los Angeles television station before entering her office.

Hoos would not specify what agents seized, but neighboring business owners said agents loaded several cardboard boxes appearing to contain documents into a government car. FBI agents at the scene said there were no arrests.

According to the affidavit, agents were looking for aircraft parts, computer files, records of sales, mailing lists and other business documents, including those connected with three other firms.

Authorities suspect that parts Signal sold were misrepresented as those produced by General Electric, the nation’s largest manufacturer of commercial jet engines.

Authorities suspect Signal sold fake parts to Texas-based 3D Industries and Ameristar Jet Charter.

Called at home Thursday night, Stehr did not answer her phone, but she referred messages to her Beverly Hills attorney, Lawrence Ecoff.

“There are no charges brought against my client and we are totally cooperating with the government,” Ecoff said. “My client did not sell, did not intend to sell, did not offer to sell commercial airline parts.”

Ecoff said Thursday’s searches and the ongoing investigation are related to a federal lawsuit in Dallas that was filed within the past year by Ameristar against Signal.

The suit, as well as a countersuit filed by Signal, relate to allegations that Signal wrongfully sold certain airplane parts, Ecoff said.

“There is a whole web here,” Ecoff said of the civil case and the government’s investigation.

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According to court documents, the federal probe began earlier this year after two FAA safety inspectors conducted a routine inspection of jet-engine parts at 3D Industries in Dallas.

During that review, the inspectors identified two General Electric jet-engine combustion liners that they suspected were unapproved parts.

The liner is a chamber used to contain fuel combustion and keep heat from transferring to the rest of the engine.

One of the Dallas inspectors told investigators that markings on the liners were inconsistent with those produced by General Electric. Since he knew General Electric was the only authorized manufacturer, the inspector suspected the ones he saw were fakes.

FAA inspectors became suspicious and tried to find some certification.

Shipping memos indicated that 15 liners were sent from GE to Signal in April 1997. Another memo showed that parts were sent from General Electric to 3D, but General Electric officials have said that memo was fraudulent.

Meanwhile, inspectors found 96 identical combustion liners at Ameristar, also in Dallas. The president of the company told authorities he purchased the parts from 3D, and showed a check for $194,712 made payable to Signal, according to court documents.

“The liners found at Ameristar were not stamped with the correct identification markings and the liners were found to have several manufacturing defects,” the affidavit states.

The task force investigation heated up in May when a federal agent with the Department of Transportation conducted a surveillance of Signal’s storage facility. She observed aircraft parts inside, stored on racks.

In August, federal agents contacted a customs agent who had been investigating Durrani for two years. Customs agents searched Durrani and Stehr’s home in 1996 and found numerous documents pertaining to Signal.

Task force officials cited those findings in their affidavit as grounds to search Stehr’s home.

“It is my belief,” special agent NormaLyn Anderson of the transportation agency wrote, “that business records related to Signal are being stored at the Camarillo residence.”

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The issue of counterfeit parts has come to the fore recently after concerns were voiced by Congress and others in the aviation industry, FAA spokesman Tim Pile said.

“It’s a concern,” he said, “but we at the FAA have put considerable resources toward the problem in recent years and we feel that we have sufficient safeguards to prevent it from being a serious safety issue.”

While the FAA and the military do have security divisions that investigate claims of fake-part manufacturing, Pile said, repeated checks before aircraft go into operation and subsequent maintenance checks minimize the danger presented by counterfeit parts.

“There is considerable redundancy to ensure that equipment is in good working order and to address problems before they occur,” Pile said.

An aircraft’s original manufacturers set the specifications for the parts that can be used in their planes.

Ultimately, the specifications are the domain of the FAA, which approves all plans for airplane design, production and maintenance, Pile said.

Approved parts generally carry a label either from the manufacturer or from the FAA or have paperwork indicating approval in an aircraft’s maintenance file, Pile said. There is plenty of opportunity for counterfeiting--a Boeing 747, for instance, has about 6 million parts, he said. And given the high cost of precision parts, there is “an opportunity for unscrupulous businesses and concerns.”

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Outside Signal’s offices Thursday afternoon, neighboring business owners watched as federal agents conducted their search of the Market Street building.

Pat Peebles, owner of RMP Services, a condominium property management business next door, said Stehr employs six people and has run the business there for more than two years.

“We knew they sold airplane parts to people, but that was about it,” Peebles said.

Thursday’s raid was stalled at one point by a bomb scare.

Almost immediately after arriving at the industrial park, Hoos said, agents halted the search after finding several suspicious devices in a warehouse.

About 20 employees at Signal and neighboring businesses were evacuated as the Ventura County sheriff’s bomb squad and military personnel inspected the devices.

Authorities would not describe what they found, but Hoos said the devices were deemed safe. Employees at nearby businesses were able to return to their offices at about noon.

Ecoff said what authorities thought were explosives were parts from a crashed U.S. military plane that Signal had purchased from the government.

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Wilson is a Times staff writer, Wolcott is a Times Community News reporter. Times researcher Robin Mayper and Times Community News reporters Massie Ritsch and Jason Takenouchi also contributed to this story.