((Automated translation by Reuters, please see disclaimer https://bit.ly/rtrsauto))
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Raytheon unit enters into deferred prosecution agreements with DOJ
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The company must hire an independent compliance monitor for three years
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Agreements also settle whistleblower lawsuit and SEC foreign bribery case
(Added comment from whistleblower’s lawyer in paragraph 9) by Luc Cohen and Nate Raymond
RTX RTX.N agreed on Wednesday to pay about $950 million to answer federal charges that it defrauded the U.S. Department of Defense by overpaying for defense systems and bribing a Qatari official to obtain contracts with the air force of this Middle Eastern country.
The aerospace and defense company’s Raytheon unit has entered into two deferred prosecution agreements to respond to criminal charges brought by the U.S. Department of Justice in federal courts in Boston and Brooklyn.
The Arlington, Va.-based company also settled civil claims filed by the department following a complaint by a former employee and agreed to resolve a foreign bribery case filed by the U.S. Commission on securities and the stock market.
As part of the agreements, prosecutors agreed to drop criminal charges against the company after three years if it complies with the terms of the deferred prosecution agreements, which include hiring a monitor independent compliance officer.
In court documents, the Raytheon unit admitted the allegations were true. RTX, which previously set aside $959 million to cover expected settlements in these cases, said in a statement that it “takes responsibility for the wrongdoing”
Investigations have hovered over RTX, formerly known as Raytheon Technologies, since 2019. The company merged with United Technologies in 2020 and changed its name last year.
Boston prosecutors alleged that Raytheon, from 2012 to 2018, defrauded the Department of Defense by paying more than $111 million more than it should have in two contracts to purchase computer systems. Patriot missiles and operation of a radar system.
Raytheon will pay a criminal fine of $146.8 million to resolve this criminal fraud case and an additional $428 million to resolve related civil claims filed under the False Claims Act, which arise from a complaint filed by a former Raytheon employee, Karen Atesoglu.
As a reward for pursuing the case, Ms. Atesoglu will receive a $4.2 million share of the settlement, the Justice Department said. Her lawyer, Pat Almonrode, called her in a statement a “courageous and determined whistleblower.”
In Brooklyn, prosecutors alleged that Raytheon, from 2012 to 2016, conspired to pay bribes to a high-ranking Qatari Air Force official in exchange for help obtaining and retaining contracts with the military branch of this Gulf country.
Raytheon was indicted for conspiracy to violate the Foreign Corrupt Practices Act and conspiracy to violate the Arms Export Control Act Control Act).
She agreed to pay a criminal fine of $252.3 million and forfeit $36.7 million, while receiving a $7.4 million credit under the related anticipated settlement with the SEC.
As part of the settlement, the company would have to pay a $75 million fine, for which it would receive a $22.5 million credit based on the criminal sanction, and forfeit an additional $37.4 million, according to the agreement reached between Raytheon and the Department of Justice.
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