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Little needs to be said about the benefits enhanced civil penalty authority would offer in combating regulatory violations in the Cockroach Corners of the United States

The safety problems we have encountered all too frequently in Cockroach Corner are well documented. We have concentrated many enforcement efforts there, but problems remain.

Enabling the FAA to take strong civil penalty action against the kinds of illegal operations prevalent in Cockroach Corner would immeasurably improve our ability to assure compliance with safety regulations.

The mere fact that an otherwise profitable operation could turn unprofitable upon discovery of safety violations would help us stem the illegal activities we have fought against for so long. Putting a significant dent in the numbers of safety violations would save lives.

Regulatory violations by aircraft operators are not the sole concern of our proposal. Persons who manufacture bogus aircraft parts would be covered. Manufacturers who ignore or hide safety defects in aircraft could be subjected to such penalties. Other serious threats to human life could be dealt with in a serious manner.

We are well aware that a number of organizations are actively working against the enactment of increased civil penalty authority. I believe that is to be expected. The point I want to make though concerns the thought that our increased civil penalty authority is intended to be used as a scattergun against the entire aviation community. Nothing could be further from the truth.

The truth is that our proposal is intended to give us the capability to deal with the worst kinds of regulatory violations that occur.

It is apparent to anyone who looks at our past record of civil penalties that we have typically accepted less-much less-than the currently authorized maximum civil penalty.

That will not change in appropriate cases. What will change is the ability to deal effectively with the kinds of serious regulatory violations which occur infrequently, but which carry with them significant threats to hunian safety.

I would like to give some brief examples of situations we have encountered which support the need for increased civil penalty authority.

These are cases in which air carriers have repeatedly dispatched aircraft carrying passengers without regard to safety defects in the aircraft. In one case an airline released an aircraft willfully in violation of the Federal Aviation regulations when the No. 4 engine anti-ice malfunction light remained on in all switch positions. The air carrier was advised of the discrepancy by an FAA inspector. The airline's director of quality control nevertheless released the aircraft for the flight from Miami to Boston on the basis that the airline would make a profit of $8,000 on the flight. The airline paid the maximum penalty of $1,000.

In another case, during a departure of a 747 flight from Honolulu to Dallas/Fort Worth, the No. 11 and No. 12 tires on the aircraft failed causing extensive damage to the antiskid conduit and fillet fairing. The airline made temporary unapproved repairs- I believe with tape-to the antiskid conduit and the fillet fairing. FAA inspectors advised the airline's director of line maintenance that the repairs were unacceptable and contrary to applicable repair manuals. When the director disagreed with the FAA, the inspectors left to go to the air carrier district office to examine the manuals. After they had left, the aircraft was dispatched. This case was 1 of 12 cases cited in a civil penalty letter against that airline involving numerous violations which reflected a pattern of disregard on the part of the airline management in an effort to keep aircraft operational so scheduled revenue flights could be carried out without interruption.

In another case, that same carrier operated a 727 on six flights in an unairworthy condition with a main cabin entrance door that failed to operate properly. Because of this condition, they assigned a mechanic to accompany the aircraft on such flights to open and close the door.

Another airline failed to perform required service checks on aircraft on 11 separate occasions. While the aircraft were used for scheduled passenger flights, the airline incurred a maximum penalty of $11,000 for the violations. The penalty was obviously too low to eliminate profit as a possible motivation for the violations.

The faulty maintenance specifically performed on the aircraft which crashed at Chicago last year subjected the carrier to a $1,000 fine. Other regulatory violations enabled the FAA to seek a much greater accumulated penalty; but the fact remains that what we see as the direct cause leading up to the accident-faulty maintenance-was punishable by only a $1,000 fine.

Maintaining good public relations apparently means to certain air carriers boarding intoxicated passengers, since we have found that certain airlines do not routinely deny passage to intoxicated persons nor do they consistently refuse to serve such persons. Virtually all cases of interference with crew members involve an intoxicated person. One can readily see the potential danger when the captain or first officer has to leave the cockpit to deal with such a disturbance. A $1,000 fine apparently has little significance, though, since 1 air carrier was fined 10 times from 1975 through 1979 for boarding or serving intoxicated persons.

There are cases in which the airlines have dispatched aircraft without the required number of flight attendants or in contravention of the requirements of the minimum equipment list. The very nature of these violations suggests willful failure to comply with the regulations. However, a $1,000 fine is cheaper than delaying a flight or possibly having to pay for hotel accommodations for passengers.

We have found quality control violations by manufacturers who release unairworthy transport category aircraft into service, or aircraft which do not meet the type design. We recently experienced a case in which a manufacturer who holds a repair station certificate returned two wide-body aircraft to airline service in an unairworthy condition. Both aircraft experienced problems in service causing abnormal landings jeopardizing the safety of the passengers on board. The penalties available for such safety violations are at the two extremes. We can either seek $1,000 for a violation, which is an insignificant penalty, or we can take action to suspend or revoke the certificate, which represents the sledgehammer approach to enforcement. Neither enforcement alternative in that particular case, and many like it, is satisfactory.

We have experienced many problems with commercial operators carrying both passengers and cargo. Operation by uncertificated operators poses a real danger to safety. Safety is compromised in the areas of crew qualifications, maintenance and inspection programs. If a commercial operator uses an unairworthy aircraft, that ordinarily subjects the operator to a maximum fine of $1,000. If the operator uses an unqualified crew aboard an unairworthy aircraft-and we have uncovered such cases—the maximum civil penalty would probably total $2,000; $1,000 for the unairworthy aircraft, $1,000 for an unqualified crew.

We have proposed criminal sanctions for violations of title VI of the Federal Aviation Act. Title VI provides the FAA with its basic safety regulatory authority. Only knowing and willful violations of title VI or the regulations issued thereunder would trigger possible criminal sanctions. Inadvertent violations of our safety regulations, unless of such a reckless character that they could be construed to meet the criminal standard of intent, would not be covered by the legislation.

A number of other titles of the Federal Aviation Act are covered already by criminal provisions. Violations of title IV, which provides the CAB's economic regulatory authority, are one example where criminal sanctions currently apply.

Under current legislative authority, behavior which is criminal in an automobile can freely take place in an airplane with only the threat of civil penalty. This is not right. Given the pervasive Federal interest in aviation safety, it is incongruous that we should have to rely on the happenstance of State aviation statutes to seek criminal penalties.

I do want to clear up one incorrect notion. Some people would have you believe the enactment of this aspect of our legislation would result in the jailing of the entire aviation community. That is neither our intent, nor would it happen.

First: Most regulatory violations are inadvertent or negligent. Our proposal requires a knowing and willful violation before criminal penalties would apply. That is a high standard of proof.

Second: Any prosecution under this authority would be handled by the Department of Justice.

As in the case of most criminal statutes, we expect that only the most egregious kinds of offenses would ever be pursued or brought to trial by the Justice Department. The publicity associated with the prosecution of an occasional serious case should be enough to reinforce sufficiently the deterrent effect of the statute.

Recognizing the substantial danger associated with improperly operated aircraft-danger not only to persons aboard the aircraft but to persons in other aircraft as well as on the ground-I can't see how it can be argued that serious penalties should not apply to those people who knowingly and willfully create a situation threatening other peoples' lives. Dangerous driving is not tolerated on the ground; it should not be tolerated in the air where one mishap can claim hundreds of lives.

I would like to cite some cases we have encountered in which criminal penalties were called for.

We have uncovered cases where persons were manufacturing and distributing bogus parts for use in transport category aircraft. In one case, counterfeit aircraft parts were being illegally manufactured and sold to airlines. Three companies were acting in concert to fabricate, “launder,” and market sophisticated electronic modules. Investigation revealed that modules had been distributed to 19 domestic and foreign air carriers. Fortunately, the State in which the offenses took place had adequate statutes which enabled a criminal prosecution, although the local prosecution of an essentially federally regulated industry presented some technical difficulties.

We have found pilots who, with reckless disregard for others' safety, have buzzed people on the surface so closely that they have hit the surface, vehicles, or the water, with passengers having been killed and persons on the ground injured.

A pilot buzzed a football stadium and crashed into the stadium.

There are cases where pilots deliberately file IFR flight plans without appropriate ratings or qualifications, thereby providing the potential for a collision with a commercial airliner full of passengers.

We have encountered drunk pilots as well as pilots who were on drugs.

One case shows dramatically the need to curb renegade activities. A pilot, who held a commercial pilot certificate, buzzed a vehicle being driven on the road. The aircraft hit the vehicle causing damage and injury. We suspended the pilot's certificate and were upheld on appeal to the NTSB. That same pilot flew while under suspension. We revoked his certificate on an emergency basis and were upheld on appeal to the NTSB and the Tenth Circuit Court of Appeal. The pilot then flew again as pilot in command without benefit of a certificate and again collided with a vehicle on the road during an attempted landing, causing substantial damage to the vehicle and injury to its occupants. The only remaining course of action to us was to seek injunctive relief in district court.

The final aspect of our legislation concerns the proposed process for hearing civil penalty cases before an administrative law judge. The majority of civil penalty cases would fall within this provision that would cover all civil penalty cases less than $10,000 in which related legal issues, such as the need for injunctive relief, are not present.

Under current law, if an acceptable compromise of a civil penalty is not reached between the FAA and a violator, the case must be tried in U.S. District Court through the U.S. attorney. The normal rights of appellate review exist for both parties.

Under our proposal, a person alleged to have committed a regulatory violation would be entitled to an informal conference with the FAA, after which the FAA could administratively assess a civil penalty if it continued to believe a regulatory violation had occurred.

The assessment of a civil penalty could be appealed to the NTSB where a full hearing before an administrative law judge would be held. An adverse decision could then be appealed to the full NTSB with further right of appeal to the courts of appeal.

The benefits are clear. A person believed by the FAA to have committed a regulatory violation would not be forced to go through a court trial. Instead, the less awesome proceedings of an administrative hearing would be available.

Administrative hearings, as is the case with certification hearings before the NTSB, could be held at a location near the alleged violator's residence.


To place our proposal in perspective, I would like to list some of the other statutory schemes which prescribe penalties for violations of rules or regulations. I do not mean to call their validity into question but to permit the subcommittee the opportunity to contrast our request with laws already on the books.

Violation of a rule or regulation prescribed by the Comptroller of the Currency under 12 U.S.C. 212 carries with it a fine of not more than $5,000 or imprisonment for not more than 1 year, or both.

Unlawfully possessing, selling, or transporting bald or golden eagles subjects an offender to a fine of $5,000 or imprisonment for not more than 1 year; for a second conviction, an individual may be fined up to $10,000 and imprisoned for not more than 2 years, or both; civil penalties up to $5,000 are authorized for each violation.

Violations of EPA standards for motor vehicle air pollutant emissions subject a person to a civil penalty of up to $10,000 with each motor vehicle or engine failing to meet the standards constituting a separate violation.

Violation of any requirement of an EPA implementation plan for air quality can be punished by a fine of not more than $25,000 per day or imprisonment not to exceed 1 year, or both; after the first conviction, the possible penalty increases to $50,000 per day or imprisonment not to exceed 2 years, or both.

The point I would like to make is that, considering the serious threat to the public welfare which can result from failure to follow aviation safety requirements, the penalties we have proposed are reasonable.

Mr. Chairman, we all share the same goal of improving aviation safety. In recent times, the FAA has been frequently singled out as the organization that should be held accountable for doing just that. But we can only work within the bounds of the authority given us by the Congress. We are now calling upon you and the members of this subcommittee to help us better attain the goal of safety by giving us the tools we need to reach that goal.

That completes my prepared statement. We would be pleased to respond to questions you may have at this time.

Mr. ANDERSON. Thank you, Mr. Bond. It seems to me the main basis for your request for increased civil penalties is you believe existing penalties are too low to discourage violations. I wonder how low the existing penalties really are.

I understand you collected a $100,000 penalty from Continental and a $500,000 penalty from American for the improper maintenance practice which was involved in the recent DC-10 accident.

Could you explain the legal theory you used to get these large penalties for what was in a sense one violation? Why can't these and similar legal theories be used in other serious cases?

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