Manufacturing Company Owner Pleads Guilty to Crimes Involving Defense Department Contracts

https://www.justice.gov/usao-sdoh/pr/manufacturing-company-owner-pleads-guilty-crimes-involving-defense-department-contracts

Department of Justice
U.S. Attorney’s Office
Southern District of Ohio

FOR IMMEDIATE RELEASE
Tuesday, April 16, 2019

Manufacturing Company Owner Pleads Guilty to Crimes Involving Defense Department Contracts

COLUMBUS, Ohio – Daniel Emerson Norton, 51, of Arlington, Virginia and owner of Torrance, California-based Emerson Company, pleaded guilty in U.S. District Court to conspiracy to commit wire fraud, concealment money laundering and tampering with documents or proceedings in connection with illegally obtaining approximately $2,229,142.40 in Defense Department contracts and providing defective parts made in China instead of U.S.-made critical application items used by the U.S. military.
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According to court documents and testimony at trial, the Department of Defense (DOD) barred Emerson Company from doing business with the U.S. Government in 2011. Norton then continued to recruit people who either already had companies or were willing to start companies to do his bidding on solicitations and contract with the military to provide parts for the U.S. military between 2011 and 2013. When one of the companies was awarded a purchase order, Norton directed them to send it to Emerson Company which would buy and ship the part directly to DoD.

Norton bought the parts from manufacturers in China, even though a large number of them were required to be made in the United States. The parts Norton provided had dimensional defects, material substitutions, incorrect or missing markings, incorrect finishes, improper shapes or styles, mislabeled packaging or poor workmanship and thus failed to conform to the contract requirements. Additionally there were contracts that called for an exact part from a specific domestic manufacturer. Rather than obtaining these parts from the specified manufacturer, Norton supplied parts obtained from China. The parts involved a variety of parts utilized on military weapon systems to include aircraft, vessels, vehicles, and nuclear reactor programs.

Once Norton realized he was under investigation in 2013 by both the Defense Logistics Agency (DLA), an agency of the Defense Department, DCIS and the U.S. Attorney’s Office, he took several steps to mislead the government in its investigations. For example, in an effort to avoid an extension of debarment for providing a non-conforming bolt used on a C-130 aircraft engine, Norton submitted false documents to the DLA deflecting blame from Emerson Company as the manufacturer. Norton knew, however, that he had ordered the bolts from a manufacturer in China and they did not conform to the contract requirements. Norton also admitted to falsely communicating information to his attorney, or allowing such information to be communicated, with the intent that it be communicated to the United States as it related to its grand jury investigation, thereby obstructing that investigation.
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