Former NASA Contractor Employee Convicted for Substituting Foreign Materials for Domestic Materials

By  //  September 9, 2019

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faces maximum penalty of 40 years in federal prison

A federal jury convicted a former NASA contractor employee for substituting foreign materials for domestic materials. Jonathan Hipps, 34,  was found guilty of mail fraud, concealment of material facts from a federal agency, and providing a false document to a federal agency.

Jonathan Hipps handled contract that required STAT to provide steel rods for use in support of NASA’s Space Launch System/Orion project at Kennedy Space Center

ORLANDO, FLORIDA – A federal jury convicted a former NASA contractor employee for substituting foreign materials for domestic materials

Jonathan Hipps, 34,  was found guilty of mail fraud, concealment of material facts from a federal agency, and providing a false document to a federal agency.

Hipps faces a maximum penalty of 40 years in federal prison. His sentencing hearing is scheduled for December 4, 2019. He had been indicted on January 16, 2019.

According to evidence presented at trial, Hipps was an employee at STAT Industry, Inc., a company that provided parts and materials to the aerospace industry, including NASA.

In the summer of 2014, Hipps handled a contract that required STAT to provide steel rods for use in support of NASA’s Space Launch System/Orion project at Kennedy Space Center.

The contract required that the steel rods originate from the United States. During the procurement, Hipps received steel rods originating from India.

Instead of replacing the rods with materials from the United States, Hipps used a box cutter to cut off all of the labels from the shipment indicating that the rods were made in India, thus making them to appear that they had originated from the United States.

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Hipps then shipped the steel rods to the Kennedy Space Center with a certification falsely certifying that the steel rods conformed to all of NASA’s requirements.

“The NASA Office of Inspector General will continue to aggressively investigate those who undermine and defraud NASA efforts to build the SLS launch vehicle and it’s systems,” said Special Agent in Charge John Corbett, Central Field Office.

“This jury verdict serves as a staunch reminder that such conduct will not be tolerated.

The NASA OIG applauds the efforts of the entire investigative and prosecution team during this investigation, and we look forward to our continued cooperation with our law enforcement partners in the pursuit of justice.”

This case was investigated by the NASA Office of Inspector General and the Air Force Office of Special Investigations. It is being prosecuted by Assistant United States Attorney Vincent S. Chiu.

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