Lockheed to Pay $4 Million To Settle Missile Sale Charges
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Saturday, August 9, 2008
Lockheed Martin will pay $4 million to settle federal charges that it took unauthorized steps to sell missiles overseas and revealed classified information, according to an agreement released yesterday.
The nation's largest defense contractor did not get proper clearance from the State Department while negotiating the sale of 460 Hellfire anti-tank missiles with the United Arab Emirates during 2003 and 2004, according to documents filed in the case. The State Department also alleged that Lockheed revealed classified information to a UAE Air Force officer during the talks. The proposed sale was never completed.
Lockheed later disclosed that one of its employees mistakenly gave classified material to an unnamed NATO ally about the Joint Air-to-Surface Standoff Missile that had not been approved for release.
The State Department said the cases violated the Arms Export Control Act and the International Traffic in Arms Regulations. The agency began an investigation in 2004 after Lockheed voluntarily notified it of the Hellfire missile case.
Under the settlement, Lockheed will pay $3 million -- with the extra $1 million suspended if it follows terms of the agreement -- which include appointing a special compliance officer to make sure the company abides by laws governing international weapons sales.
Lockheed spokesman Tom Jurkowsky said yesterday the company neither admits nor denies the violations, but that any release of classified information or violation of arms sales laws was not intentional.
"The personnel mistakenly assumed that because the UAE already had Hellfire missiles that no further approval was needed," he said.
Shares of Bethesda-based Lockheed Martin rose $3.77, or 3.5 percent, to $112.06.
