
Apparently, defense contractors can buy their way out of bad behavior—$950 million ought to do it.
At a glance:
- RTX Corporation (formerly Raytheon) agreed to a $950 million settlement over bribery and fraud allegations involving defense contracts with Qatar.
- The settlement includes criminal fines, civil penalties, and restitution for inflated contracts and bribery of a high-ranking Qatari official.
- RTX must adhere to anti-corruption measures and will be monitored for the next three years to ensure compliance.
Defense contractor RTX Corporation, formerly known as Raytheon, agreed on Wednesday to a massive $950 million settlement to resolve allegations of bribery and fraud related to its defense contracts with Qatar. The settlement comes after years of investigations into the company’s dealings, and it appears that RTX is now paying the price for inflating defense contract costs and bribing foreign officials.
https://x.com/regretfulvet/status/1847042923042689072
The corporation, which rebranded after merging with United Technologies in 2020, entered deferred prosecution agreements in federal courts in Massachusetts and Brooklyn. The terms of the settlement require RTX to hire independent monitors and follow strict anti-corruption protocols over the next three years.
Of the $950 million, $428 million is earmarked for criminal fines over fraudulent practices like inflating labor and material costs to win no-bid contracts, driving profits higher on the backs of U.S. taxpayers. Another $400 million in penalties addresses the bribery allegations, which center on payments made to a high-ranking Qatari military official from 2012 to 2016 to secure lucrative defense deals.
RTX, which pleaded not guilty to charges under the Foreign Corruption Practices Act and the Arms Export Control Act, didn’t contest the allegations detailed in court documents. Instead, the company took a predictable route—issuing a statement claiming they are “taking responsibility for the misconduct” and assuring the public that they’re committed to ethical business practices.
CEO Christopher Calio emphasized that these issues stemmed from Raytheon’s operations prior to its merger with United Technologies. He stated that corrective actions have already been taken, though whether these measures will be enough to prevent further misconduct remains to be seen.
The investigation also revealed that Raytheon employees and agents paid bribes to secure multi-million-dollar contracts with the Qatar Emiri Air Force and the Qatar Armed Forces, as well as with the Gulf Cooperation Council.
This isn’t RTX’s first brush with controversy. Just in August, the company agreed to pay $200 million to the U.S. State Department for violating the Arms Export Control Act by sharing classified information with countries like China, Iran, and Russia. With multiple scandals in such a short time frame, it’s clear that RTX’s ethical track record is in serious question.
It seems like paying fines has become just another business expense for some defense contractors—an unfortunate reality that leaves American taxpayers footing the bill.