Podcast: AOG Technics Mastermind Jailed After Parts Fraud

Aviation Week editors discuss the recent sentencing of and ramifications for mitigating parts fraud risk, as well as actions companies are taking now. 

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AI-Generated Transcript

James (00:00)
Welcome to the MRO podcast. I'm James Pozzi MRO editor for the EMEA region. And today we are looking at the AOG Technics case, which of course has gained a lot of widespread media attention, both in the aviation world and in the mainstream media news too. So we're going to look at the case today and maybe the ramifications of that and some of the initiatives that have been born out of this parts fraud. So joining me today are Lee Ann Shay who's executive editor for MRO and business aviation for Aviation Week, and Sean Broderick, Aviation Week's safety editor. Lee Ann, Sean, great to have you both back on.

Lee Ann (00:45)
Thanks for having us.

Sean B (00:46)
Great to be back on.

James (00:47)
Brilliant. Let's start with the case then. The latest on AOG, I guess the legal side, we record this on Friday at end of the week, on it goes out live Monday. so kind of in the last week, the kind of ruling with the court the outcome of that. So what's the latest on AOG? Lee Ann and Sean.

Sean B (01:12)
Well, we have a sentence. We have a sentence for the mastermind. It seems the one-person mastermind of the AOG Technics scandal. Full name, as noted in court documents and from the UK Serious Fraud Office, Jose Alejandro Zamora-Yrala.

He is a former techno DJ apparently, but was the mastermind behind a scheme that sold more than 60,000 parts to dozens of airlines and MROs over four years, most of them for CFM56s. This all happened from January 2019 to July 2023 until a technician at TAP Air Portugal suspected a part, I think it was a bolt, an engine bolt, didn't fit in the hole it was supposed to go into. So that led the technician to begin asking questions and it uncovered a falsified airworthiness release certificate. That led to many more falsified airworthiness releases. And started well, I say the regulators, it was more the legal side that really dug into this. The aviation regulators put out suspected unapproved parts notices. The industry dug into it, mostly Safran and GE because CFM was mostly affected and they found in the end more than 60,000 parts. Now, a couple of notes about this case to sort of put it in perspective, like none of this is good. And every part on an engine, has got to be authentic and airworthy to work. But the numbers, 60,000 parts that were worth right about 7 million English pounds, on the exchange rate, 9 million, $9.5 million. You're looking at about 150 bucks a part.

So we're talking a lot of washers, a lot of seals, a lot of bolts, not a lot of, you know, turbine blades. So was it serious? Yes. But when we think of parts, when we discuss parts, you know, in Inside MRO, we write about parts. We write a lot about the bigger expensive parts. These were a lot of the smaller, less expensive parts. Still, still fraudulent, still not safe, but to put it in perspective, that's what was happening. So. Fast forward to today, and we'll talk about what this has spawned, but really the takeaways from this is that industry needed better systems for tracking and tracing parts, validating documentation and ensuring that they are working with credible suppliers. Some of this, all of this was already known.

None of this was a surprise to anybody in the industry. What I think the AOG Technics case has done has helped shine a spotlight on these issues and help jumpstart some already going issues or some already in process projects and ideas and foster some new ones. We've written a lot about them. We will write a lot more about them. We're going to talk about some of them here.

But this was really, was it a watershed moment? I guess we'll see in five or 10 years, but it was not an aha moment in terms of we didn't realize we had this problem. Nor was it a problem that really got the regulators more involved. Because if you look at how this was handled, most of this was handled through industry.

The FAA and EASA and the UK CAA, they put out subs notices. The first subs notice on this came out in August 2023. And it was routine. Nobody paid any attention to it for about a month. And then I think Bloomberg picked up the story and then it kind of took off from there with us and a whole lot of other people writing about it. But the regulators just sort of looked at it and said, okay, that's another subs case, which it was, biggest one in history, but it was just another unapproved parts case and you're really not having a whole lot of change at the aviation regulator level. That's not necessarily a bad thing if you ask industry because they don't necessarily want the regulators to get involved because then you get prescriptive actions that may or may not align with industry best practices and they may not get to the result that's going to be the most productive and sustainable for industry. So, Lee Ann I was gonna say, throw it over to you, so we talk about the coalition, that's really the biggest thing to probably come out of this.

Yeah, before we get into that, I just wanted to echo your part. You know, Unapproved parts is not new. Robert Sumwalt, who was one of the co-chairs of the coalition, wrote an op-ed for us and pointed out, 1957, the Flight Safety Foundation published a paper that warned of safety issues associated with unapproved parts. And then there was a lot of unapproved parts stuff going on in the early 1990s. But as late as 2023, two Florida residents pleaded guilty and were sentenced to a little over a year in federal prison for conspiring to sell aircraft parts with counterfeit airworthiness approval tanks.

So I think what's different though is that he was you know, one person working from a home computer and he was going after these, you know, high engine parts, which just feels different, but I think also the reaction, as you pointed out, uh, Sean from industry not having to be forced by the regulators to do something, I think is really good. And they're making a difference because they've bucketed those recommendations into short-term, medium, and long-term. And the coalition is making an impact.

As you point out, there's the vendor accreditation document traceability and non-serialized part traceability and the industry is making progress in each of those categories. And Sean, you wrote about, StandardAero in mid-August shared its rigorous check for acceptance training program, which is now mandatory for anyone at StandardAero who is receiving parts.

Sean B (07:48)
And they of course are a coalition member, the coalition is the aviation supply chain integrity coalition we're talking about that was formed in 2024 on the heels of the AOG Technics case.

Lee Ann (08:00)
Yeah, that's important deal. Sorry, I forgot to mention that. They formed in February and then in October, just six months later, they released these 13 recommendations after doing a really good job of studying. And we should also, I think, point out the founding members. Airbus, American Airlines, Boeing, Delta Airlines, GE Aerospace, Safran, StandardAero, and United.

James (08:24)
Yeah, and long term, will kind of the aims and targets be of this, of course? I AOGs are expensive as we know for airlines. One of the figures that stood out was  39.3 million pounds, around 53 million US dollars was what the Serious Fraud Office estimated the groundings to remove the parts cost airlines and some of the airlines affected by that, of course, were American, for example, and they didn't buy directly from AOG.

They still found that 28 of its engines were affected and it lost, I think, 21 million pounds from all of this. Ryanair, Southwest, Ethiopian were in there. Virgin Australia, I remember reporting on as well, having some issues with their CFM56s. How can the industry, I guess, mitigate against future Zamoras, I guess, from doing this illegal practice.

Lee Ann (09:16)
Yeah, going back to the three major buckets of the aviation supply chain integrity coalition's recommendations, vendor accreditation. Use the FAA’ss voluntary industry distributor accreditation program or EASA's quality management system, document traceability. Use digital eARCs. And Sean, I know you'll be able to talk about that, because those include encryption algorithms and digital signatures to make the whole record safer. And then non-serialized parts traceability, that one might be a little bit longer term, but use digital twins, maybe blockchain, there's something around that.

Sean B (10:05)
Nothing the aviation industry or regulators will do is going to change human nature. So you will always have people who will try to commit crimes for their benefit or the benefit of a group that they're working on. Criminals are going to crime. That's just the way it is. What you have to do is make it more difficult, if not impossible, to be taken advantage of by developing more robust systems.

And that's really it, more more layers, more things to make it harder. mean, the forging of these airworthiness release certificates was seemingly done at home on a regular old printer. I think the most effort that was done, I mean, there was a lot of effort put into this fraud, fake employees sending fake emails.

And once they got a customer, Ethiopian court documents showed that Ethiopian is on the hook for like 10% of the parts, like over more than 5,000 parts, almost 6,000 parts, one and a half million dollars worth of parts they bought from AOG Technics. The criminals are going to try to find a hole. They're always going to do that. You know, all we can do, or all industry can do, is try to plug those holes. And that's things like the electronic authorized airworthiness release that has been, almost finalized. Well, it has been finalized because they've started to send them out … Southwest Airlines and Boeing and a Boeing battery shops, they sent the first one from the battery shop to Southwest what last September. And that is apparently that is picking up in terms of the number of Boeing shops that are being able to do this and the number of airlines that are getting the electronic paperwork that you can't forge with a desktop printer. So it's going to be a whole lot more of that. A lot of training like StandardAero has done. A lot of circling back and seeing what happens with things like AI and blockchain like Lee Ann mentioned and how can that be applied to the industry to make things better? It's gonna be a consistent and layered approach, I would say.

James (12:10)
I'm saying technology and digitalization. Yeah, that's certainly kind of areas that can progress this. Because as you mentioned, it was done on a home computer from his home in Surrey in England. And it just sounds very unsophisticated in many ways, but obviously very lucrative as we mentioned earlier. He made sort of nearly 7 million quid from this. So yeah, there's food for thought there. Lee Ann, please.

Lee Ann (12:35)
Thank you. Quick question for both of you. The electronic arc creates a quote, immutable and verifiable record of part authenticity throughout its life cycle, according to Aeroxchange President and CEO Al Koszarek. Do you think that the industry will ever get to a point where there will be a standardized parts like a standardized electronic trading platform? Kind of like how we use ATMs, you know, we all can go to a bank anywhere in the world, put in our card and there is a protocol, a secure protocol that allows us to get some cash out.

Sean B (13:21)
I think a set of standards so you can have, you know, multiple different ATM networks.

But you have a common set of standards. So I think that that's what we could hope for in aviation. So you can have multiple competing platforms maybe, but they are interoperable. If you don't have that, then I think you have a problem. Because as we all know, these assets move all around. They move from lessor to lessor airline to airline, MRO to airline. whatever system you pick, you got to… it's gotta be able to talk to whatever system is on the other side. I do think those systems, everybody's eventually gonna be on the system, but I don't think it's gonna be one system.

James (14:04)
No, yeah, competing platforms, think I'd agree with Sean there. I think several, and people will develop them and grow them. Yeah, but maybe not one kind of standardized platform as such. I mean, as nice as that would be. And the ATM comparison is a good one actually, but yeah, probably several options, I imagine.

Lee Ann (14:24)
Yeah, I agree with that because no one likes a monopoly. But if there are, you know, the protocols that allow these different systems, you know, to talk to each other, just so you can have a more seamless and safe parts trading environment. Seems like it'd be a good thing.

James (14:39)
Absolutely. Absolutely. Yes.

And yeah, just closing out then a few of the ramifications of this. Zamora was sentenced to 56 months in prison, which is four years and eight months. He pled guilty to fraudulent trading at the end of last year in December 2025. It's worth mentioning there's an ongoing investigation still from the Portuguese authorities, and Zamora is facing a proceeds of crime.

So this is often passed down post-conviction and it's aimed at recovering assets gained through criminal conduct. For example, cash seizures, freezing orders and confiscation orders too. So that is ongoing and we'll no doubt be seeing more about that later this year.

Sean B (15:25)
And James, one point at the beginning. He’s the mastermind and so far the only one named at least on the UK side, but it's far from clear that he was the only one that was aware of what was going on and that was working on it and benefiting from it because again, there were a handful of buyers that bought a lot of parts. And so it remains to be seen whether there were, you know, other collaborators.<\/p>

James (15:50)
Absolutely, and I'm interested in the origin of these parts. Most of them still remains unknown from what I understand too.

Sean B (15:59)
It's a good point. Yeah, it's a good point. The most curious thing that I thought is like, did he get all this stuff? Like, what is it? Where did he get it? When was he going to the equivalent of the UK Home Depot and buying it? I don't know.

James (16:09)
Yeah, I'm not sure you'd find blades in bit of a queue or …

Sean B (16:13)
Five bolts though, and it's 150 bucks a bolt. Not a bad racket the guy had until he got caught.

James (16:19)
Absolutely. I know we said earlier, it's not a new thing. There's been cases like this before, certainly one of the more curious cases of recent years, I think, related to the industry. And certainly, as I said earlier, it's got a lot of widespread attention. It’s been certainly a topic of various conferences and trade shows over the last couple of especially related to things like parts integrity. So yeah, it's certainly made an impact.

James (16:45)
Well, Lee Ann, Sean, thank you so much for joining us today and giving us the insights there on this case. That's all for today. Thank you for listening to the episode. Either via Apple or Spotify. While you're there on those platforms, please leave us a star rating and a review. And thank you very much for listening.