Sometimes you are better off cooperating, sometimes not. Many times, with small stuff, it goes like this... The FSDO becomes aware of something and needs to check it out. This gets assigned to an inspector. Inspector is furnished with some type of lead or has word that you did it, or were somehow involved. You explain to inspector. Inspector is satisfied it was a minor or isolated incident. Inspector tells their boss and end of story. Big trouble sometimes comes when it really is a minor issue, though the Feds aren't sure at this point and really want to know what happened, and you don't cooperate. This forces them to launch an official investigation. This is when things usually get worser... as you have forced their hand. In any case I might recommend a qualified attorney; though to lawyer up and such might be a bit premature.