RTX subsidiary Raytheon to pay more than $950 million to settle foreign bribery, export control fraud probes

The Raytheon subsidiary of defense contractor RTX agreed Wednesday to pay more than $950 million to settle U.S. Department of Justice investigations into an alleged government contract fraud scheme, violations of foreign bribery laws and the Arms Export Control Act.

Raytheon also agreed to pay more than $124 million to settle charges filed by the U.S. Securities and Exchange Commission that it violated the Foreign Corrupt Practices Act in connection with paying bribes of more than $32 million to a relative of the emir of Qatar and to military and government officials in that country in exchange for obtaining defense contracts there. More than $22 million of that settlement will be offset by Raytheon’s settlement with the DOJ.

The company as part of the DOJ settlement also agreed to enter into deferred prosecution agreements involving that conduct in federal district courts in Brooklyn, New York, and Massachusetts.

The company was charged in the Brooklyn case with conspiracy to violate anti-bribery laws in a scheme to bribe a high-level government official in Qatar and with failing to disclose the bribes in export licensing applications with the State Department as legally required.

In the Massachusetts case, Raytheon admitted to engaging in two separate schemes to defraud the Defense Department in connection with the Patriot missile systems and a radar system, along with other defense products and services.

The company also will retain an independent monitor for three years and enhance its internal compliance program as part of the settlement, which the DOJ announced.

“Raytheon engaged in criminal schemes to defraud the U.S. government in connection with contracts for critical military systems and to win business through bribery in Qatar,” said Deputy Assistant Attorney General Kevin Driscoll of the DOJ’s Criminal Division, in a statement.

“Such corrupt and fraudulent conduct, especially by a publicly traded U.S. defense contractor, erodes public trust and harms the DOD, businesses that play by the rules, and American taxpayers,” Driscoll said.

RTX in a statement said the settlements with the DOJ and the SEC relate to probes previously disclosed by the company, and that “these legacy legal matters relate to conduct that occurred at Raytheon Company largely prior to 2020,”

“RTX is taking responsibility for the misconduct that occurred,” the company said. “We have worked diligently during the investigations to remediate that misconduct and continue to do so. We are committed to working closely with the incoming independent monitor to improve and further enhance our ethics and compliance program.”