Paterson defense company owner accused of $7 million military contracts fraud
By Jonathan Greene
Published: September 7, 2018
The owner of a city defense contracting business has been indicted for allegedly acquiring $7 million in military contracts through a fraudulent scheme and conspiring to unlawfully export military technical drawings to Turkey.
Ferdi Murat Gul, also known as “Fred Gul,” 42, of Turkey, was indicted by a federal grand jury Wednesday on conspiracy to commit wire fraud, wire fraud, conspiracy to violate the Arms Export Control Act.
Gul remains at large in Turkey, according to U.S. Attorney Craig Carpenito’s office.
Authorities said Gul is the owner of two companies, Bright Machinery Manufacturing Group, a defense contracting company operating out of Paterson, and FMG Machinery Group, a manufacturing company purported to be operating in Paterson and Long Island City.
Gul also maintains an ownership interest in HFMG Insaat, a manufacturing company in Turkey.
From October 2010 through June 2015, Gul allegedly obtained hundreds of contracts worth $7 million from the U.S. Department of Defense by falsely claiming military parts contracted to produce would be manufactured in the U.S.
Gul allegedly manufactured the parts at his Turkish production facilities. In doing so, he unlawfully exported drawings and technical data to Turkey that are subject to U.S. export control laws.
Gul and co-conspirator 1 of Paterson and co-conspirator 2 of Clifton supplied foreign-made parts to the federal government. Both co-conspirators worked at Bright Machinery Manufacturing Group. 1 as a production manager and 2 as a commercial sales and purchasing manager, authorities said.
Authorities said Gul and his conspirators concealed their illicit manufacturing activities. They forged certifications and sent false emails to the Department of Defense claiming Bright Machinery Manufacturing Group and its American subcontractors performed quality control tests on the military parts.
Bright Machinery Manufacturing Group acquired 346 military contracts to domestically built military parts for torpedoes for the U.S. Navy, bomb ejector racks, armament used by U.S. Air Force aircraft, and firearms and mine clearance systems used by U.S. military personnel outside abroad.
Testing of the parts by the Department of Defense revealed some of the parts had design flaws and nonconformities that rendered them unusable.
Gul faces more than 40 years in prison and more than $1 million in fines.