Contractor Guilty Of Overcharging Government
This article is from the archive of The New York Sun before the launch of its new website in 2022. The Sun has neither altered nor updated such articles but will seek to correct any errors, mis-categorizations or other problems introduced during transfer.
PHILADELPHIA — A defense contractor accused of overcharging the American government for radar components pleaded guilty yesterday to obstruction and will pay $9.5 million in fines, federal authorities said.
Herley Industries Inc., based in Lancaster County, admitted to two counts of obstructing audits of bids to supply components for Navy and Air Force radar systems. Its former chairman, Lee Blatt, 80, pleaded guilty to failing to create and maintain tax records; he was sentenced to a year’s probation, community service, and a $25,000 fine. The guilty pleas came the day the case was scheduled for trial.
Prosecutors said Herley admitted that in 2001 and 2002, it gave federal auditors false information and withheld data about the cost of making some electronic components used in E-2C Hawkeye aircraft radar. They said the company admitted that the government was overcharged about $2.5 million on about $3.2 million in contracts.
“When the government is misled into overpaying for any of its contracts, ultimately, it is the taxpayers who foot the bill,” U.S. Attorney Patrick Meehan said.
