Falsified Quality Assurance Report Records

A US-based public company was alerted that quality assurance reports relating to parts from a supplier were being manipulated at the company’s assembly facility in Mexico. Axium was engaged to investigate the concerns. We conducted an extensive review of shipping records, part intake forms, and defect reports and interviewed numerous employees at the facility. We found that an arrangement existed between the supplier and employees at the facility to falsify the quality assurance reports for the parts made by the supplier. Under the arrangement, the company’s employees at the facility would reduce the number of defective parts in the reports and, in exchange, the supplier would have its technicians repair assembled products that had been damaged at the facility. In the scheme, the supplier received a better score on its quality and the facility did not report products that had been damaged prior to shipment to customers.