Boeing to Pay U.S. $4.4 Million to End Chinook Billing Case
Boeing Co. (BA), the second-largest defense contractor, agreed to pay the U.S. $4.4 million to resolve allegations that it overbilled the government for work on Chinook military helicopters.
The settlement requires Boeing to retrain its employees and make improvements to software it uses to track its billing, Philadelphia U.S. Attorney Zane Memeger said today in a statement. A whistle-blower lawsuit alerted the government to the issue, according to the statement.
“Some of the most important cases begin with a citizen who sees something wrong and speaks up,” Memeger said in the statement. “Whistle-blowers who notify the government of possible fraud allow us both to correct that specific problem and to prevent similar misconduct from recurring in the future.”
The U.S. Justice Department awarded Boeing a contract in 2003 to produce and modify new Chinook helicopters as part of the Army’s effort to modernize its fleet. More than 100 Chinooks were ordered.
A government probe revealed that Boeing managers instructed mechanics to perform non-billable work while separately billing the U.S. for their time resulting in the government being charged for work for which it had already paid, according to the statement.
Damien Mills, a spokesman at Boeing’s Chinook plant in Ridley Park, Pennsylvania, said the company cooperated fully with the government’s investigation.
“As the investigation revealed, this is a matter of inadequate charging discipline in the past, not of any deliberate wrongdoing,” Mills said in an e-mailed statement.
The case is U.S. v. The Boeing Co., 10-cv-00634, U.S. District Court Eastern District of Pennsylvania (Philadelphia)
To contact the reporter on this story: Sophia Pearson in Philadelphia at spearson3@bloomberg.net
To contact the editor responsible for this story: Michael Hytha at mhytha@bloomberg.net
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