Nine of the nation's top 10 defense contractors -- including such corporate giants as McDonnell Douglas, Rockwell International, Lockheed and Boeing -- are under criminal investigation by the Pentagon, according to documents disclosed yesterday.
Defense Department Inspector General Joseph H. Sherick, who announced in April that 45 of the top 100 military contractors were under investigation, identified the subjects of the probes in a list provided to Rep. John D. Dingell (D-Mich.). The list cited such allegations as bribery, kickbacks, false claims, gratuities, bid rigging, cost mischarging and product substitution.
Sherick detailed 36 of the cases, but told Dingell he could not reveal the nine others because the contractors have not been told that they are under investigation. The Justice Department may have joined the investigations in some cases.
Dingell, chairman of the House Energy and Commerce subcommittee on oversight and investigations, is sending the list to his colleagues to drum up support for military procurement reform measures that are before the House this week.
Dingell, who has criticized the administration for prosecuting few major contractors, said in an accompanying letter, "The Pentagon simply must get tough with its partners in industry so as to end this bizarre behavior and stem the hemorrhage of taxpayers' money."
Pentagon spokesman Jim Turner said the investigations do not necessarily involve senior company executives and that some of the allegations, as Sherick noted, involve subcontractors.
"In no way should this number indicate that the defense industry as a whole is behaving improperly," Turner said. At the same time, he said, Sherick wants "to get the message out to anyone that might steal from the Department of Defense that . . . if we catch you, you're going to jail."
Spokesmen for nearly a dozen contractors said yesterday they were not familiar with the probes or could not comment.
Sherick's list, which reads like a Who's Who of the defense industry, said 15 of the top 20 contractors were under investigation as of May 1.
It said that McDonnell Douglas Corp., the nation's top defense contractor with $7.7 billion in business last year, is under investigation for cost mischarging. Spokesman Gerald Meyer said he knew nothing of the probe and that "we have not engaged in any criminal mischarging."
The Army suspended payments to the company's Hughes Helicopter division in May for what it called duplicate billings and unallowable claims.
Rockwell International Corp., the second largest contractor with $6.2 billion in business, also is being examined for cost and labor mischarging. Mischarging involves transferring company costs that are not reimbursable to contracts that the government will pay for.
General Dynamics Corp., the No. 3 contractor, has been under investigation for allegations ranging from improper billings to underbidding on submarine contracts. Sherick said the company is also being examined for alleged product substitution, cost duplication, defective pricing and cost mischarging.
The Pentagon is also examining the following allegations, according to the list:
* Lockheed Corp. (ranked No. 4), labor mischarging.
* Boeing Co. (No. 5), cost and labor mischarging.
* General Electric Co. (No. 6), false claims, defective pricing, labor mischarging and product substitution.
General Electric pleaded guilty in May to defrauding the Air Force out of $800,000 on a nuclear warhead contract by altering timecards and shifting costs, and was fined $1 million.
* United Technologies Corp. (No. 8), bribery, gratuities, subcontractor kickbacks, cost mischarging and defective pricing.
* Raytheon Co. (No. 9), labor mischarging and product substitution.
* Litton Industries (No. 10), bribery, subcontractor kickbacks, false claims, bid rigging, and labor and cost-mischarging.
* Grumman Corp. (No. 11), cost mischarging.
* Martin Marietta Corp. (No. 12), subcontractor kickbacks and cost mischarging.
* Westinghouse Electric Corp. (No. 13), cost mischarging.
* Sperry Corp. (No. 15), defective pricing and labor and cost mischarging. Sperry previously pleaded guilty to falsifying $325,000 in bills on the Minuteman missile and paid $850,000 in penalties.
* Honeywell Inc. (No. 17), bid rigging and diversion of government property.
* Ford Motor Co. (No. 20), falsification of performance records, defective pricing and labor mischarging.
The list also cited allegations involving TRW Inc. (defective pricing, cost mischarging), Texas Instruments (product substitution), Northrop Corp. (false progress payments, labor mischarging), and Fairchild Industries (gratuities, product substitution and cost mischarging).