Two Lockheed Martin subsidiaries have agreed to pay $70 million to the federal government for overcharging the Navy for aircraft parts. (Wikimedia Commons)
2 min read Last Updated: June 22, 2024 | 07:20 AM IST
Two Lockheed Martin subsidiaries have agreed to pay $70 million to the federal government for overcharging the Navy for aircraft parts, the Department of Justice announced Friday.
Federal agencies say Sikorsky Support Services, based in Stratford, Connecticut, and Delco Aerospace, based in Milwaukee, Wisconsin, knowingly entered into fraudulent subcontracts for spare parts and materials for aircraft used to train Navy pilots.
Under the contract, Sikorsky purchased parts from Delco at the cost Delco paid to other suppliers plus a 32 percent markup.
Sikorsky then billed the Navy for the payments it made to Delco, in violation of federal rules banning such arrangements, which prosecutors argued increased costs to the government.
“Today’s settlement demonstrates that the Department of Justice will ensure that government contractors do not engage in private deals that circumvent the law and artificially inflate rates at American taxpayers’ expense,” Brian Boynton, head of the Justice Department’s Civil Division, said in a statement.
A Lockheed Martin spokesman did not immediately respond to an email seeking comment Friday.
Prosecutors said the settlement resolves a lawsuit brought by former Delco employees under the whistleblower provisions of the federal False Claims Act.
Darin Jones of the Defense Department’s Office of Inspector General said the settlement should serve as a deterrent to those looking to abuse the department’s procurement process.
Greg Gross, director of the Naval Criminal Investigative Service’s Economic Crimes Field Office, added that excessively high costs of parts and materials for aircraft repair and maintenance are impacting Navy aviation training and to the detriment of American taxpayers.
(Only the headline and photo of this report may have been modified by Business Standard staff. The rest of the content is auto-generated from a syndicated feed.)
First Published: 22 Jun 2024 | 07:20 AM IST
