RTX Corporation, formerly known as Raytheon, has reached a significant settlement agreement to resolve allegations of defrauding the government and paying bribes to secure business with Qatar. The defense contractor has agreed to pay more than $950 million in penalties, fines, and restitution.
The settlement includes a $428 million civil penalty for allegedly providing false information to the government to obtain costlier contracts and double-billing on a weapons maintenance contract. Additionally, nearly $400 million in criminal penalties were imposed for various offenses, including bribery and inflating costs for missile systems and radar surveillance.
RTX has also agreed to a $52.5 million civil penalty to settle a Securities and Exchange Commission investigation related to the bribery allegations. The company must forfeit at least $66 million to resolve both criminal and civil probes.
RTX acknowledged its misconduct and committed to maintaining a robust compliance program to ensure adherence to global laws and regulations. The company emphasized its dedication to integrity and ethical business practices while serving its customers.
The legal resolutions were revealed in separate cases in federal courts in Brooklyn and Massachusetts. The agreements require RTX to hire independent monitors to oversee compliance with anti-corruption and anti-fraud laws for the next three years.
Assistant Attorney General Matthew Olsen issued a warning to companies engaging in illegal practices when selling sensitive military technology overseas, emphasizing the consequences of violating the law.
RTX disclosed that it had set aside $1.24 billion to address legal and regulatory matters, primarily stemming from issues predating its merger with United Technologies in 2020. The company has taken corrective actions to address legacy gaps that led to the legal challenges.
These legal issues have been ongoing, with RTX previously agreeing to pay $200 million to the State Department for alleged violations of export control regulations. The company faced allegations of providing classified military data to unauthorized entities and mishandling sensitive information.
The settlement with the government marks a significant step for RTX in resolving its legal challenges and moving forward with a renewed commitment to compliance and ethical business conduct.
