Raytheon, a subsidiary of defense contractor RTX, will pay more than $950 million to resolve federal investigations into fraud schemes and violations of the Foreign Corrupt Practices Act (FCPA) and the Arms Export Control Act (AECA).
According to a Wednesday press release from the DOD, Raytheon admitted to “engaging in two separate schemes to defraud the Department of Defense (DOD) in connection with the provision of defense articles and services, including PATRIOT missile systems and a radar system.” The company will enter into a three-year deferred prosecution agreement (DPA) over the matter.
The schemes led to the DOD overpaying Raytheon more than $111 million between 2012 and 2018.
Raytheon also entered into a three-year DPA due to a “conspiracy to violate the anti-bribery provision of the FCPA for a scheme to bribe a government official in Qatar and conspiracy to violate the AECA for willfully failing to disclose the bribes in export licensing applications with the Department of State as required by part 130 of ITAR,” the release describes.
Between 2012 and 2016, Raytheon bribed Qatari military officials for sham subcontracts.
“Raytheon entered into and made payments on sham subcontracts for air defense operations-related studies in order to corruptly obtain the QEAF official’s assistance in securing certain air defense contracts,” the DOD said. “Raytheon also entered into a teaming agreement with a Qatari entity in order to corruptly obtain the QEAF official’s assistance in directly awarding a potential contract to Raytheon to build a joint operations center that would interface with Qatar’s several military branches.”
Deputy Assistant Attorney General Kevin Driscoll of the Justice Department’s Criminal Division said in a statement, “Raytheon engaged in criminal schemes to defraud the U.S. government in connection with contracts for critical military systems and to win business through bribery in Qatar.”
“Such corrupt and fraudulent conduct, especially by a publicly traded U.S. defense contractor, erodes public trust and harms the DOD, businesses that play by the rules, and American taxpayers,” Driscoll continued. “Today’s resolutions, with criminal and civil recoveries totaling nearly $1 billion, reflect the Criminal Division’s ability to tackle the most significant and complex white-collar cases across multiple subject matters.”
