Charged With Laundering Scrapped Jet Engine Parts

The owner of an aircraft parts broker in Ridgefield, NJ, appeared in Newark federal court Tuesday following his arrest Monday night for an alleged conspiracy to launder scrapped jet engine parts.

According to a news releases from U.S. Attorney Paul J. Fishman, Gideon Vaisman, 73, of Edgewater, NJ, the sole owner of Tara Technology Corp. in Ridgefield, is charged in a criminal complaint with one count of conspiracy to commit wire fraud.  He will appear on the charges this afternoon before U.S. Magistrate Judge Madeline Cox Arleo.

According to the complaint unsealed upon Vaisman’s arrest, Vaisman orchestrated a scheme, from April 2005 to May 2013, to defraud FAA repair stations, aircraft parts brokers, aircraft parts end-users and others by using phony documents to resell jet engine parts obtained from scrap metal dealers. Among other things, Vaisman instructed Tara Technology’s general manager, Carmine Coviello, 61, to use his Suffern, N.Y.-based aircraft parts broker and seller company, Shelby Enterprises, to purchase vital jet engine parts called “blades” and “vanes” from scrap metal dealers. Once Coviello purchased the blades and vanes, he had them cleaned, sanded and inspected at a metal shop to conceal that they had been scrapped and on occasion rejected for repair by an FAA repair station. He did this at Vaisman’s direction and in violation of FAA regulations, which mandate that only FAA-certified repair stations or certified airframe and power plant mechanics may perform such work on aircraft parts.    

Also at Vaisman’s direction, Coviello conducted sham sales of the illegally altered blades and vanes to Tara Aviation, Ltd., an aircraft parts broker and seller – incorporated in Tortola, British Virgin Islands, and located in Guernsey, United Kingdom – which was controlled and financed by Vaisman. The sole purpose of these sales, which occurred only on paper, was to generate fraudulent trace paperwork for the parts. The parts never left New Jersey. Trace paperwork documents the history of an aircraft part and includes information such as the part’s manufacturer, the aircraft on which the part was used and how it was used. The paperwork is also employed in determining whether an aircraft or aircraft part has been subject to severe stress or heat as would occur during a major engine failure, accident or fire.

Vaisman, Coviello and a sales representative stored the blades and vanes in Tara Technology’s warehouse inventory, ultimately selling them to aircraft brokers, airlines and others on behalf of Tara Aviation using the fraudulent trace paperwork.

The count with which Vaisman is charged carries a maximum potential penalty of 20 years in prison and a $250,000 fine, or twice the gross gain or loss from the offense.

Coviello previously pleaded guilty, before U.S. District Judge Mary L. Cooper, to an information charging him with conspiracy to commit wire fraud in relation to the scheme. His sentencing is scheduled for Sept.12, 2013.

The charge and allegations against Gideon are merely accusations, and the defendant is presumed innocent unless and until proven guilty.

FMI: Read the Complaint