Boeing to Pay $25 Million in Drone Settlement
January 13 2021 - 2:29AM
Dow Jones News
By Andy Pasztor
Boeing Co.'s drone unit has agreed to pay $25 million to settle
civil-fraud allegations that it overcharged on more than half a
dozen contracts signed with the U.S. Navy and special forces
between 2009 and 2017.
Announced Tuesday by the Justice Department and Pentagon
investigative agencies, the settlement stems from whistleblower
claims by a then-official of the unit, Insitu Inc., that it
knowingly charged new-part prices for "less expensive recycled,
refurbished, reconditioned and/or reconfigured parts." According to
the Justice Department, the contracts with the Navy and the
Pentagon's Special Operations Command required new parts and
materials.
Under provisions of the Federal False Claims Act, the government
took over a civil suit initially filed by the whistleblower, who
will receive more than $4.6 million of the total. Boeing didn't
acknowledge any wrongdoing.
The settlement comes less than a week after Boeing agreed to pay
$2.5 billion as part of a settlement resolving a criminal charge
that it defrauded the Federal Aviation Administration during the
agency's safety review of the 737 MAX jet. Prosecutors laid out a
pattern of activity by two Boeing pilots to deceive regulators
about a software system that ultimately led to two crashes in which
a total of 346 people died.
Boeing acknowledged responsibility in that case, agreeing to pay
a $244 million fine and pledging to tighten internal ethics rules
and compliance standards.
Write to Andy Pasztor at andy.pasztor@wsj.com
(END) Dow Jones Newswires
January 13, 2021 02:14 ET (07:14 GMT)
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