Buyer convicted of insider trading
Also, former USAR maintenance chief explains grounding of KC-135 fleet for part failure
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Steve Buyer, former Congressman for Indiana’s 4th and 5th districts, was convicted last week on four counts of securities fraud. He will face sentencing on the convictions on July 11.
Buyer was found guilty of making stock purchases using insider information he obtained while working as a lobbyist and consultant following his political career. The jury agreed with prosecutors that the former politician profited by purchasing $568,000 in common stock of cell phone giant Sprint just prior to its 2018 merger with T-Moblie, tipped off by a T-Mobile executive during a golf outing.
Buyer also was found to have profited from insider information involving a company merger between consulting and lobbying firms Navigant and Guidehouse. In all, Buyer profited by $320,000 for himself and his family using the information.
An insider trading conviction may result in up to 20 years in prison and/or a fine of up to $5 million. U.S. District Court Judge Richard M. Berman, of New York’s Southern District where the trial was held, will decide Buyer’s sentence.
Buyer entered politics in 1992 after serving as an attorney in the U.S. Army Reserve during the Gulf War. He originally campaigned on military and veterans’ health issues and was elected over incumbent Jim Jontz. He then served five terms in Congress, retiring in January 2010; four days after an ethical complaint was brought against him by the Citizens for Responsibility and Ethics in Washington, alleging possible improprieties concerning Buyer’s non-profit Frontier Education Foundation. That complaint was dismissed in July 2010.
KC-135 groundings proof of good maintenance
Last month, the U.S. Air Force temporarily grounded its entire KC-135 refueling and RC-135 reconnaissance fleets over concerns of a faulty tail pin. The precaution was taken until all of the aircraft could be inspected for possible failure of the part, and the part could be replaced.
Retired U.S. Air Force Reserve Col. Frank Faulkner oversaw maintenance of the KC-135s stationed at Grissom Air Reserve Base as the group commander until his retirement in 2001. He explained that such an inspection for a non-conforming part is evidence of due diligence being exercised.
Faulkner had no direct knowledge of the situation but speculated that such precautionary actions are central to the reason why the KC-135s are still in the air more than 60 years after their introduction.
“They may have found something on a plane and as a matter of due diligence said, ‘we want to inspect the entire fleet because of this to be proactive in preventing anything,’” said Faulkner. “You have to perform these safety checks because just about every fighter on a mission is going to use the tanker to refuel. They are critically important.”
Faulkner said that the KC-135’s maintenance manager would have told the crew chief to check the tail pin for possible failure. If discovered on one plane, all of the KC-135s then would be examined for the same failure, and the part would be replaced.
Faulkner explained that the KC-135s were first produced in 1962 and received an engine upgrade in 1993. The refueling aircraft are part of the U.S. Strategic Air Command and are used to refuel war planes in mid-flight. Despite their age, he contended that the average KC-135 only logs about 20,000 flight hours before being retired; a fraction of the airtime flown by a commercial airliner during its lifespan.
“I don't think anybody back in the 1950s when they were designing that plane thought it was going to be around for 60 years, but steady maintenance makes it possible,” said Faulkner. “That’s one of the good things about the Reserves. A lot of times we have people that are working there for 10-15 years on the same planes.
“It's not like active duty where you have a guy there, then he rotates and is gone in three years. We had guys working together for 15-20 years; knowledgeable guys and a designated crew on those planes. Think of the maintenance people as the service people at a car dealership. They check this particular part. If it's not problematic, you're good to go. If it is problematic, they have a fix for it.”