(Bloomberg) -- RTX Corp. agreed to pay more than $950 million to settle multiple federal probes related to attempts to win business in Qatar and defraud the US in defense contracts.
The company agreed to pay the amount to resolve three separate federal criminal investigations, the Justice Department said in a statement Wednesday. In addition, the Securities and Exchange Commission said the company will pay more than $124 million to resolve a related civil probe into corrupt payments in Qatar.
The Justice Department had been investigating RTX, which changed its name from Raytheon last year, since 2020 over the bribery allegations related to Qatar as well as the pricing issues. The Arlington, Virginia-based based maker of jet engines and military hardware said in July that it had set aside a combined $959 million to resolve the federal probes.
“Raytheon engaged in criminal schemes to defraud the US government in connection with contracts for critical military systems and to win business through bribery in Qatar,” Deputy Assistant Attorney General Kevin Driscoll said in a statement. “Such corrupt and fraudulent conduct, especially by a publicly traded US defense contractor, erodes public trust and harms the DOD, businesses that play by the rules, and American taxpayers.
RTX said in its own statement that it’s taking “taking responsibility for the misconduct that occurred.” The company also agreed to extend its compliance programs and hire an independent corporate monitor.
“We have worked diligently during the investigations to remediate that misconduct and continue to do so,” the company said.
News of the multiple settlements trickled out slowly over the course of the day.
Brooklyn Hearing
First, at a court hearing in Brooklyn, New York, RTX General Counsel Raja Maharajh told a federal judge that the company would pay at least $290 million in fines and penalties over violations of arms export and foreign bribery laws related to the company’s dealings in Qatar.
“Raytheon paid more than $30 million to a Qatari agent who was a relative of the Qatari Emir and who, despite being retained as Raytheon’s representative in Qatar, had no prior background in military defense contracting,” the SEC said in a statement.
About an hour later, court documents in Massachusetts outlined that RTX agreed to pay $257 million in the procurement case that was tied to defrauding the US in contracts for Patriot missile components and surveillance radar.
The DOJ said Raytheon employees “provided false and fraudulent information” to the Department of Defense during contract negotiations.
The Justice Department later put out a statement about the $428 million False Claims Act settlement related to defective pricing schemes. Prosecutors said the company failed to provide truthful certified cost and pricing data during negotiations on numerous government contracts between 2009 and 2020.
The SEC separately announced the civil fine.
(Updates with Justice Department statement.)
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