NASA probe extends to Martin Marietta

December 04, 1993|By Ted Shelsby | Ted Shelsby,Staff Writer Bloomberg Business News contributed to this article.

Martin Marietta Corp. acknowledged yesterday that it is being investigated as part of a federal probe into alleged fraud and kickbacks among contractors and government officials involved with NASA's Johnson Space Center in Houston.

"To the extent that we are requested, we are giving the government our full support and cooperation," said Charles P. Manor, a Martin Marietta spokesman at its headquarters in Bethesda. "We are cooperating fully."

Mr. Manor would not discuss the workers' involvement in the alleged fraud, but he said neither held senior positions with the company. He also refused to say what type of information the government was seeking from the company.

According to published reports, two employees at Martin Marietta's operations in Houston were videotaped by the FBI in the process of accepting bribes. Both left the company in October. One was fired and the other resigned.

The probe is aimed at finding corruption within NASA's Life Sciences Projects division, which studies long-term effects of space flight on humans.

Government officials have said that about a half-dozen employees with the National Aeronautics and Space Administration, up to 24 outside workers and a couple of corporations have been implicated in the FBI sting operation, called "Operation Lightning Strike," which was launched about 18 months ago.

As part of the sting operation, an FBI agent, posing as a wealthy businessman, set up a company called Space Inc. to peddle a fake ultrasound kidney stone-smashing device that astronauts could take with them on long space journeys.

The businessman paid cash bribes and kickbacks in an unsuccessful effort to get the device placed on a space shuttle mission, the reports said.

Martin Marietta is one of NASA's largest contractors. Mr. Manor said the company did about $600 million in business with the space agency last year, supplying such things as external fuel tanks for the space shuttle, satellites and spacecraft.

This business could be in jeopardy, according to one aerospace industry analyst.

"It depends on how serious the charges are," Paul H. Nisbet said. "They could be barred from bidding on new contracts for at least a period of time." Mr. Nisbet, formerly an analyst with Prudential-Bache Securities, is president of JSA Research in Newport, R.I.

"What's a bit unfair," Mr. Nisbet added, "is that people will see the Martin Marietta name in the news and not realize that this involves the GE division it acquired earlier this year." He was referring to Martin Marietta's $3.05 billion acquisition of General Electric Co.'s aerospace division in April.

GE spokesman Bruce Bunch directed all questions about the investigation to Martin Marietta.

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