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Deepwater Whistleblower Challenges Testimony by Lockheed Martin

May 25, 2007 


Michael DeKort, who has helped to expose the Coast Guard Deepwater scandal, issued a letter today challenging testimony by Lockheed Martin before two Subcommittees of the House Homeland Security Committee last week. On a number of issues, Mr. DeKort finds that Lockheed Martin Maritime Systems President Fred Moosally was not entirely accurate or truthful when he testified May 17. Full text of the letter follows.


May 25, 2007

Representative Loretta Sanchez, Chairwoman
Subcommittee on Border, Maritime and Global Counterterrorism
U.S.House of Representatives
Committee on Homeland Security
Washington, D.C. 20515


Representative Christopher P. Carney, Chairman
Subcommittee on Management, Investigations, and Oversight
U.S. House of Representatives
Committee on Homeland Security
Washington, D.C. 20515

Dear Chairwoman Sanchez and Chairman Carney:

I am writing to request that this letter be included in the record of your May 17, 2007 hearing on the Coast Guard's Deepwater program, “Deepwater: Charting a Course for Safer Waters.” At that hearing, you received testimony from Mr. Fred Moosally, President of Lockheed Martin Maritime Systems and Sensors. As a former employee of this division of Lockheed Martin who had personal experience implementing this program, I am writing to point out that several of the representations Mr. Moosally made at the hearing were not correct. I urge you to continue your oversight activities and stand ready to assist in your efforts to hold the Coast Guard and Lockheed Martin accountable for their failures. My comments here are listed by issue:

Low Smoke

  • Mr. Moosally suggests the COTS (Customer off the Shelf) directive overrode the Low Smoke requirement. 

    • The fact of the matter is that we built almost all of the 490 cables – very few were non-COTS.  In all of the cases where we built cables the parts were available to make Low Smoke cables.  Waivers in those rare cases should have been no problem.  Lockheed Martin didn't use Low Smoke cables in most of the cases because they were missed in the design and later not fixed for cost and schedule reasons.  Also Moosally states there is no impact because the cables are small and that they connect to peripheral equipment such as printers. The requirement does not differentiate the need based on size or device they are connected to – it is based on use, location and potential hazard. According to the Department of Homeland Security Inspector General (DHS IG) the waiver the Coast Guard granted was inappropriate.  Lockheed Martin put cost and schedule concerns over safety of the crew.

Ext Equipment

  • Mr. Moosally says the Coast Guard was immediately notified of problems in mid-2005 there was a potential issue.

    • The Coast Guard was not immediately notified.  Lockheed knew in late 2003 there were problems.  The first item we looked in to was the FLIR systems which did not meet specifications (something Moosally admitted to in his statement).  Management directed me and my team to not look in to whether or not the equipment beyond the FLIR met environmental requirements.  Even though I submitted an Integrated Coast Guard Systems (ICGS) problem report on this and specifically requested it be fixed or included as a deficient item on the DD-250 (the contractual acceptance document) Lockheed purposefully left it off that document. As a result of these actions Lockheed purposefully hid the true impact from the Coast Guard.

    • The DHS IG stated that 30 items on the 123-foot patrol boats (123s) and over a dozen on the Short Range Prosecutors (SRPs) did not meet contractual requirements.

    • The DHS IG stated that fulfilling these requirements was critical given the operational environment these boats operate in.

    • The DHS IG stated the requirements were clearly defined.

    • The DHS IG also stated that Lockheed Martin originally self-certified the systems as meeting the requirements. When questioned on why they self-certified these systems as passing when they actually failed Lockheed originally said these requirements did not exist and later recanted that and stated that certification was “not really beneficial”.

    • Lockheed did not notify the Coast Guard of the true extent of the problem until August 2006.  Even at that point Lockheed stated that the equipment either did not or may not meet requirements.  Lockheed then stated that checking to see if they met requirements would be “time consuming, expensive and of limited value”. The truth of the matter is that verifying this can be done in several minutes by checking the vendor data on line or calling the vendor.

    • Lockheed Martin actually submitted requests for waivers against these requirements stating that the 123s would most likely not face the adverse conditions in the requirements.  This is a very reckless comment and request.  Lockheed based this on the location of the first 8 123s.  All 8 were sent to Key West which would not expose the boats to extreme temperatures for example.  This is a red herring.  These were only 8 of 49 123s.  A significant number of those other 123s were destined for places that experience extreme weather. Additionally the 8 boats mentioned could have been sent on duty outside of their originally intended home ports.  The IG admonished Lockheed in the report along these exact lines.

    • The IG closed on the issue by stating that these waivers should not be granted given the safety impacts of doing so.

    • This example clearly demonstrates the lengths Lockheed Martin would go to avoid accountability.  They went from incompetent in the beginning to willfully withholding information from the Coast Guard to actually advising and recommending that the Coast Guard waive the requirements because they overstated their need in this area. Lockheed was willing to deploy not only 49 123s with this problem and 91 SRPs but every other boat it built over the life of the contract.  This is due to the commonality requirement built in the System of System design approach.  Lockheed was directed to deliver like systems with common implementations. Lockheed's plan was and still is to continue down this road.  If they succeed the Coast Guard will be crippled for decades to come as its critical systems will fail in adverse conditions.


  • Mr. Moosally states the DHS IG stated that even though the optimal cables were not used and there were visual TEMPEST failures that the acceptance of the systems – through the instrumented tests - was acceptable.

    • The fact of the matter is that the Navy failed the TEMPEST tests relative to the instrumented failures and that the Coast Guard improperly waived those failures (this includes having used many of the wrong type of cables). The waivers were improper because the person who waived those failures was not qualified to do so and those failures were too critical to waive according to the 232A TEMPEST requirements in the contract and government best practice norms.  The IG erred in its findings on this issue.  I would expect if asked they would now confirm that.

  • Lockheed signed a self-cert document for the Matagorda saying it did pass 232A when they knew it did not.

  • These failures pose extreme communications security risks.  Not only can these boats be easily eavesdropped on they can inadvertently transmit clear classified information for hundreds or thousands of miles.  For example the SIPRNET circuit - the government's classified internet - is used by many organizations in the government including DoD, the Coast Guard the FBI and DEA.  Any compromise of this circuit compromises all of the users.  Lastly – given Adm Collins own press release detailing a mission near Cuba several years ago – the Matagorda did in fact use the SIPRNET circuit.  This action severely compromised the nations secure communications in two ways. One – anyone who was listening could clearly here or read what was transmitted.  Second – one could compare the inadvertent clear communications against the intended encrypted communications and be able to tell how our crypto equipment was scrambling the information.

  • The actions of Lockheed Martin have put the nation at risk.  They were warned of this exact scenario in mid-2003 by not only myself but an internal TEMPEST expert and an engineer who worked for the Coast Guard.  Lockheed Martin purposefully continued down a road that put the nation at risk to avoid accountability and to minimize coast and schedule impacts.


  • Mr. Moosally says the IG found the cameras fully comply. That is based on the finding by the IG that there were not requirements for the quantity of cameras or 360 degree coverage. 
    • This was an incorrect conclusion on their part. There is a 2 camera requirement in the Northrop specifications, not the Lockheed specifications.

    • There was a 360 degree requirement as shown by the official Coast Guard test lead who stated he checked for 360 degree coverage when he tested the system and the fact that the Coast Guard wrote the requirement the way they did to get the exact same solution they currently had on the 270-foot cutters. The 270-foot cutters have 360 degree coverage with their system.
  • He says the blind spots are acceptable because the cameras are part of a multi-prong solution involving sentries and an intrusion alarm.

    • The system was requested to specifically eliminate sentries in port and help save money on personnel.

    • The intrusion alarm only works if you try to gain access to the inside of the boat.  More importantly it does not stop someone from putting a charge on the side of the hull or gaining access short of entry to the interior.  One can still walk around the deck

    • The IG report criticized the Coast Guard and Lockheed Martin for knowingly installing a system with blind spots.

  • Mr. Moosally says it wasn’t prudent to fix the system because it was too costly. 
    • The cost for one more camera, installed, was less than $1000 per boat.

  • Like the issues before this, Lockheed has demonstrated its willingness to say and do anything it can to avoid accountability and to minimize cost and schedule impacts while it ensures the highest return possible for its shareholders.

In closing, I would like to make some comments on Mr. Moosally’s testimony and his overall performance in these matters.  In 2004, as I worked my way up the chain in order to find satisfactory resolutions of these matters I attempted to schedule a meeting with Mr. Moosally.  He would not accept that request.  I was especially discouraged at the time given not only the gravity of the issues but the fact that he was a former Navy officer – which should have heightened his sensitivity to these types of maritime safety and security issues. This, combined with the events on the USS Iowa in 1989 when he was the CEO, give me great cause for concern that I am especially disheartened and wary of his performance and ethical conduct. 


Michael DeKort

Founded in 1981, the Project On Government Oversight (POGO) is a nonpartisan independent watchdog that champions good government reforms. POGO's investigations into corruption, misconduct, and conflicts of interest achieve a more effective, accountable, open, and ethical federal government.

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