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Defense contractor RTX has agreed to pay more than $950 million to settle claims that it bribed a Qatari official to facilitate arms sales to the country and defrauded the Pentagon by overpaying for weapons including Patriot missile systems.
The company, formerly known as Raytheon, was accused of paying the US Department of Defense an additional $111 million between 2012 and 2018 for the missile system and the operation of a radar system.
RTX also entered into a deferred prosecution agreement with U.S. federal prosecutors for conspiring to bribe a Qatari official and failing to disclose these bribes in export licensing agreements. Prosecutors said the company paid $30 million to a member of the ruling family’s Qatari council and a cousin of the Qatari emir, Tamim bin Hamad al-Thani, in an effort to sell its Patriot system to the Gulf state, a crucial American ally in the Middle East.
Officials at Qatar’s embassy in Washington did not immediately respond to requests for comment.
Breon Peace, the U.S. attorney in the Eastern District of New York, said: “Over several years, Raytheon employees bribed a senior Qatari military official to obtain lucrative defense contracts and concealed the bribes by providing documents to the government. forge. violation of laws, including laws designed to protect our national security.”
“We will continue to pursue justice against corruption. . . to ensure that this misconduct is not repeated,” he added.
As part of the agreement, the company will install an independent compliance monitor for a period of three years.
RTX also settled a claim from the Securities and Exchange Commission, which alleged it violated anti-bribery and accounting laws.
“Time and time again, managers and employees raised concerns about warning signs of corruption related to the agent,” the SEC alleged, referring to the emir’s Qatari relative. “Yet the relationship with the agent, who provided very little support for the work performed, continued unhindered.”
Shares in RTX ended the day higher in New York on news of the fine, which was in line with the amount the company set aside in its latest quarterly results in July.
“RTX takes responsibility for the misconduct that occurred,” the company said. “These historic legal issues relate to conduct that occurred largely before 2020 at Raytheon Company.”
RTX is one of the Pentagon’s largest contractors and is known for its missile systems. Together with the Patriot, it makes the Stinger and, in a joint venture with Lockheed Martin, Javelin missiles, which Ukraine has used against Russia. It is also working with Israeli defense company Rafael Advanced Defense Systems on the Jewish state’s Iron Dome interception system.
Russia’s invasion of Ukraine has increased global demand for weapons, leading to higher revenues at RTX and other so-called prime contractors. RTX had revenues of $19.7 billion in the second quarter of 2024, up 8 percent from the same period last year. Sales in 2023 totaled $68.9 billion.
The company will announce its third quarter figures next week.