A Byron company that manufactures munitions for the government and law- enforcement agencies has been indicted on charges that it defrauded the government by relabeling and selling defective diversionary grenades to the FBI.
David J. Karlson, CEO of Byron-based Pyrotechnic Specialties Inc., two employees and the company itself are named in the federal indictment. Among the charges are conspiracy, money laundering, and conspiracy to defraud the government.
According to the indictment, Pyrotechnic Specialties contracted with the Department of Defense between 1996 and 2007 to be a manufacturer of diversionary grenades, commonly known as "flash bang" or "stun grenades" used to confuse and disorient a potential threat.
The grenades cause a bright flash and a loud, nonlethal blast that interferes with an enemy's sensory perception, U.S Attorney Max Wood said in a new conference this morning that also included representatives from the FBI, Naval Criminal Investigation Service, Bureau of Alcohol, Tobacco, Firearms and Explosives, the IRS' criminal investigations unit and the Environmental Protection Agency's criminal investigation division.
The grenades, known as the MK141, were developed by the Navy and were to be used by members of the Special Forces Operations, the Marine Corps and the Army, according to the indictment.A slightly different model was developed for use by civilian law enforcement agencies.
In March 2003, a flaw was discovered in the original Navy design of the grenade, Wood said."The plastic lug would sometimes crack because of the pressure exerted ," he said.
As a result, the Department of Defense issued a stop-work order on April 29, 2004, so the flaw could be corrected, according to the indictment.
Pyrotechnics Specialties developed a correction for the defect, but to sell the flawed grenades, the company allegedly schemed to relabel the devices for resale and claim that they met military standards, Wood said.
Jaclyn Zappacosta, an assistant FBI agent in charge of the Atlanta field office, said Pyrotechnics Specialties was the FBI's sole provider of "flash bang" grenades from 2000 to 2005.
In that time, the FBI received about 41 shipments, costing more than a half-million dollars, she said.
Three FBI agents were injured on Oct. 14, 2004, during a kidnapping investigation when a defective "flash bang" grenade prematurely detonated while it was still in a SWAT team agent's tactical vest pocket, according to the indictment.
All three agents were seriously injured.
The company no longer is manufacturing the "flash bang" grenades, said Morgan Fisher, resident agent in charge for the ATF office in Macon.
It's very unlikely any of the defective grenades were shipped to troops serving in Iraq and Afghanistan, said Jeffrey A. Jenkins, supervising special agent in charge of the Georgia for the NCIS.
Karlson, CEO of Pyrotechnic Specialties, F. Brad Swann, a sales representative for the company, production manager Daniel Ramone, and Glenn D. Cundiff, an engineering technician at the Naval Surface Warfare Center in Indiana who provided technical oversight regarding contracts, are scheduled for their first hearing this afternoon.
No trial date has been set.