A Washington state metallurgist pleaded guilty this week to falsifying hundreds of test results for steel used to produce U.S. Navy submarines, the Justice Department said as it moved to conclude a stunning fraud case that spanned more than 30 years and put American taxpayers on the hook for extra Pentagon maintenance costs on one of the military’s most expensive assets.
Prosecutors said Elaine Thomas, 67, of Auburn, Washington, faked steel strength test results more than 240 times from 1985 through 2017 in what appears to be one of the longest-running instances of military-related fraud in recent history. She faces up to 10 years in prison and a $1 million fine. Her sentencing is set for February.
Thomas oversaw tests designed to ensure that the steel used to fabricate submarine hulls does not fail during a collision and can withstand wartime scenarios at sea, meaning the reliability and effectiveness of America’s submarine fleet theoretically could have been at risk as a result of the scheme.
The dangers to Navy submarines on patrol were illustrated dramatically last month when the nuclear-powered USS Connecticut hit what officials said was an uncharted undersea mountain in the South China Sea. Eleven crew members sustained minor to moderate injuries, and the submarine’s commander and two other top officers were relieved of their duties.
More broadly, the steel case shines a fresh spotlight on the extent to which companies and even individuals in America’s war-fighting supply chain could directly impact national security. Although there is no evidence that any submarine hulls have failed because of substandard steel, the Pentagon has had to keep a closer eye on the materials in question and has been forced to conduct more rigorous maintenance on the affected vessels.
“The Navy has taken extensive steps to ensure the safe operation of the affected submarines,” the Justice Department said in its statement Monday. “Those measures will result in increased costs and maintenance as the substandard parts are monitored.”
It’s unclear exactly how much extra money has been spent on maintenance and other costs related to the steel test fraud.
The lawyer representing Thomas, John Carpenter, said in a statement Monday that his client acknowledged she “took shortcuts” during the testing process.
“Ms. Thomas never intended to compromise the integrity of any material and is gratified that the government’s testing does not suggest that the structural integrity of any submarine was in fact compromised,” he wrote, according to The Associated Press. “This offense is unique in that it was neither motivated by greed nor any desire for personal enrichment. She regrets that she failed to follow her moral compass — admitting to false statements is hardly how she envisioned living out her retirement years.”
For more than three decades, Thomas conducted the tests out of a foundry in Tacoma. The 240 production batches of steel from 1985 through 2017 represented about half of all the steel produced for the Navy, federal prosecutors said.
Bradken Inc., based in Kansas City, Missouri, acquired the Tacoma foundry in 2008. Prosecutors said there is no evidence that Bradken officials knew about the fraud before 2017, when a metallurgist being groomed to replace Thomas flagged suspicious test results and alerted the company, the government said.
The company accepted responsibility for the offense last year and agreed to a civil penalty of nearly $11 million, prosecutors said.
The fraud revelations sparked a major review inside the Navy. Service leaders said they went to great lengths to inspect all submarines built using steel from the Tacoma foundry.
“We have done the work to understand any potential risk, and believe we have mitigated any potential risk for our in-service submarines,” James Geurts, former assistant secretary of the Navy for research, development and acquisition, told U.S. Naval Institute News last year. “It did cost us some time to go do the exploration to make sure that we were comfortable with the safety of our sailors.”
The Navy also examined all steel that had been bought but hadn’t made it to factory floors.
“We have done a sweep of any material that was in the queue for new construction submarines. That’s a little easier because it isn’t in the submarine yet, and we’re confident in the material for any of the new construction submarines,” Mr. Geurts said last year.
• This article is based in part on wire service reports.