In one case, Raytheon employees provided defective pricing information, leading the DoD to overpay on two contracts by roughly $111 million.
Raytheon, a subsidiary of defense contractor RTX, has agreed to pay more than $950 million to resolve federal investigations into government contract fraud, as well as violations of anti-corruption and export control laws.
The settlement, announced by the Department of Justice (DOJ) on Oct. 16, addresses allegations involving defective pricing on military contracts with the U.S. government, as well as illegal bribes to a Qatari official, with the resolution involving both civil and criminal penalties.
An RTX spokesperson confirmed the settlement, telling The Epoch Times in an emailed statement that the company acknowledges responsibility for the misconduct and has cooperated with investigators. The company also emphasized its commitment to bolstering its compliance and ethics programs.
Raytheon has admitted to two major fraud schemes affecting Department of Defense (DoD) contracts, including the provision of PATRIOT missile systems and radar systems.
In the first case, Raytheon employees provided defective pricing information, leading the DoD to overpay on two contracts by roughly $111 million between 2012 and 2018.
In a separate scheme, Raytheon failed to provide accurate cost or pricing data for numerous DoD contracts, including a weapons maintenance agreement, leading to further inflated payments.
Under the terms of a three-year deferred prosecution agreement, Raytheon will pay a criminal monetary penalty of $146.8 million and $111.2 million in victim compensation and retain an independent compliance monitor for three years.
The company received a 25 percent reduction in penalties for taking remedial actions, such as firing employees responsible for the misconduct and implementing new controls to prevent future fraud.
Additionally, Raytheon has agreed to pay $428 million to settle False Claims Act allegations related to providing false data during contract negotiations with the DoD. As part of the settlement, Raytheon admitted it misrepresented labor and material costs for weapon systems and double-billed on a radar station contract.
“The department is committed to holding accountable those contractors that knowingly misrepresent their cost and pricing data or otherwise violate their legal obligations when negotiating or performing contracts with the United States,” Principal Deputy Assistant Attorney General Brian M. Boynton, head of the DOJ’s Civil Division, said in a statement.
By Tom Ozimek
