Raytheon Watch

Its Not the Crime in the Streets,
Its the Crime in the Corporate Suites

Raytheon Settles: Justice
Department Alleges
Swindle of Taxpayers

On October 14, 1993, Raytheon paid $3.7 million to settle allegations that it misled the Defense Department by overstating the labor costs involved in manufacturing Patriot missiles. The Justice Department said Raytheon failed to disclose that less skilled, lower-paid workers could produce the weapons, which gained fame as an "effective" weapon during the Persian Gulf war. ''The recovery of this money is yet another warning to contractors that the Truth in Negotiations Act's information disclosure requirements will be strictly and sternly enforced,'' Frank Hunger, assistant attorney general, said in a statement.

Although mere citizens would be thrown in jail for committing fraud on the scale alleged by the Justice Departement, Raytheon was rewarded for this fraud when it received a $62.5 million contract just weeks before the settlement from the Army to upgrade Patriot radars under the Patriot Growth Program and an $18 million contract from the Marine Corps for mobility enhancement kits for the Hawk air defense system.

The true performance of the Patriot missiles during the Gulf War was grossly exaggerated by the Pentagon and Raytheon. Although they claimed that the Patriots were successful in intercepting incoming SCUD missiles, few if any of the SCUDS were actually stopped. Unfortunately, this military fraud on the public was never given due coverage in the mainstream press. The story of the Patriot's poor performance was recognized by Project Censored as one of the most censored stories in 1991.

Raytheon Watch

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