How To Steal From The US Army? Ask Ibis Tek

Controversy

The Ibis Tek main logo

Ibis Tek is a company that receives contacts from the US government to provide features for the Army's all-terrain vehicles like the Humvee. Specifically, they had a subcontract to produce Vehicle Emergency Escape Windows aka Egress windows. This contract was with the US Army Tank-Automotive and Armaments Command (TACOM), who is responsible for the overseeing and  receiving of these contracts. Owned by Thomas Buckner and John Buckner, these men inflated the costs to manufacture these windows by creating a shell company, Alloy America LLC, to produce these frames in China for $20, producing fake invoices, and sold them at $70 per frame. They also, failed to credit TACOM with $6,085,709 of sold scrape aluminum from the manufacture process. This would lead to the Buckner brothers to a maximum sentence of 16 years in prison and a fine of $1,500,000 for both.  The punishment for the other men would rain form, a maximum prison statement of 19 years to a fine of $250,000. 

John Buckner and Tom Buckner show off the company's add-on bumpers and light bar for the U.S. military Humvee utility vehicle fitted with transparent armor

Stakeholders

Stakeholders in this unethical action are many in number. The first is the Buckner brothers and their manipulation of the US government. The next are Harry Kramer, David Buckner, and Anthony Shaw who were the secondary perpetrators in the fraud. Next are the new owners of Ibis Tek, which has to deal with a company with a defaced name. Next is TACOM, which had millions of dollars stolen from them. Then there is the American taxpayer, who had their money stolen through fraud. Lastly, there are the everyday soldiers that could have possibly got a defective product given to them  by a company that seeks to only increase their profits.

A HMMWV Emergency Egress Windshield

Individualism

Next, there are many ethical theories that help to elaborate on this fraud. In the individualism theory, the goal is to maximize profit within the law. Ibis Tek was a very reputable company that produced a product for military service to save lives. Once the fraud case came out, the public image of the company was tarnished and their finances took a hit. These men wanted to increase profit, but they did it illegally through the embezzlement of the US Army's money. They did not just embezzle the company's money, but also the company's trust. The best way, for the company to move forward, has to be to sell the company; which the owners did.

Utilitarianism

 In the utilitarianism theory, business actions aim to maximize happiness over a long period of time. Many of the main stockholders never benefited from the fraud actions. The Buckner brothers sought to gain happiness at the expense of the happiness of the US Army and the American taxpayer. Their associates sought to gain happiness also at the expense of others happiness by helping to falsify invoices within the company. Next is TACOM and the American taxpayers, who had their happiness tarnished by being deceived and possibly paying for a defective product. Thereby using manipulating the governments to get more money. Then, there are the everyday soldiers who could have had their happiness tarnished due to the fact that they got a defective product. These products could have costed lives in operations around the world. The only way to provide the the best happiness to the most amount of people are having the perpetrators pay back everything they owe to the government. Also, one must save the jobs of the employees and the companies contracts, so selling the company to people that would provide better happiness to everyone affected. 

Kantianism

Kantianism is another ethical theory,  that honors and respects the individual and their choices through informed and rational consent. The owners of Ibis Tek didn't conform to the Kantian principles at all. Under the "formula of humanity" (known as the Categorical Imperative) the Buckner's used the massive military industrial complex to illegally profit from the US government. This illegal profit was without consent and rationality. Then, there is the "Good Will" under the Kantianism theory, which states that one must have good intentions for their actions and that the Buckner's didn't have this in mind. They used the good will provided by TACOM sought only for themselves. In order to conform with these, the perpetrators must give back and do  charity work to establish good will within the local populace and the national armed services. 

Virtue Theory

A Soldier using a HMMWV Emergency Egress Windshield

Lastly, under the virtue theory, which states that one must embody good character traits and to avoid bad traits in business. These bad traits are considered vices. These vices by the Buckners' includes greed, dishonesty, selfishness, and untrustworthiness. Greed is seen through the Buckners' need to profit from the United States government. Another is dishonesty, where the Buckners' lied to the investigators and their workers about their company's finances. The next is selfishness, because the Buckners' focused solely on the their own well-being. The last is untrustworthiness, because their stakeholders trusted the Buckners and they forbid that trust. Good traits are called virtues. Ibis Tek needs to reassert many virtues to right these wrongs. One virtue is accountability due to the fact that the owners stole and hide massive amounts of money from their customers. Another is clarity. Ibis Tek needs clarity within the company due to the illegal actions by the Buckner brothers. Next is integrity. Integrity helps to provide a moral ground for one's actions in the workplace. This helps to provide a discipline in the workplace. The last virtue is trust. With the scandal that has rocked Ibis Tek, re-establishing trust internally and externally is paramount to success.

References:

https://www.bizjournals.com/pittsburgh/news/2017/10/11/founders-of-defense-contractor-sentenced.html

https://www.bizjournals.com/pittsburgh/news/2017/06/01/pittsburgh-firm-under-new-ownership-leadership.html

http://www.post-gazette.com/business/pittsburgh-company-news/2017/05/31/Ibis-Tek-Butler-County-fraud-Army-Humvee-plead-federal-court-6-million/stories/201705310215

https://www.justice.gov/usao-wdpa/pr/five-plead-guilty-6-million-dod-fraud

http://www.foxbusiness.com/markets/2017/10/10/brothers-who-owned-defense-firm-sentenced-in-fraud-scheme.html