WASHINGTON — Teledyne Industries Inc. Thursday pleaded guilty to fraud and conspiracy charges in the Pentagon Ill Wind corruption case and agreed to pay more than $4.3 million in fines, reimbursements and court costs.
In addition, the first government official indicted in the case, former Navy purchasing officer Stuart E. Berlin, pleaded guilty to three felony counts of bribery, fraud and conspiracy for his role in a scheme to illegally steer a Navy electronics contract to Teledyne. Berlin faces up to 25 years in prison and $750,000 in fines.
Los Angeles-based Teledyne said that it agreed to plead guilty to the charges because a former executive had designed a "corrupt and illegal arrangement" to buy secret government contract data from Berlin through two defense consultants, Fred H. Lackner and William L. Parkin, who remain under indictment.
Trial Was Imminent
Teledyne and Berlin entered the pleas in U.S. District Court in Alexandria, Va., 10 days before their trial was to begin.
Teledyne's plea contained a provision under which the firm will reimburse the Defense Department for nearly $1.1 million in illegally obtained profits on electronics test gear. The company agreed also to forgo any future profits on the tainted contract and to surrender to the military all technical data on the equipment so that other firms can take over the work.
The guilty pleas outline a scheme that is at the heart of the government's investigation into corruption in the Pentagon's $150-billion-a-year procurement system. The probe, which broke open last June, centers on the sale of inside Pentagon information to consultants working on behalf of some of the country's largest defense contractors.
The case, built largely from wiretaps and surveillance by agents of the FBI and Naval Investigative Service, has been described as the broadest inquiry ever into fraud and bribery in military procurement.
Berlin admitted Thursday that, beginning in 1985, he sold confidential information on a Navy electronics contract to consultants Lackner and Parkin, who in turn allegedly sold it to officers of a Teledyne subsidiary for $160,000.
Teledyne, in a statement Thursday, acknowledged that the purpose of the plan "was to subvert the lawful operation of the government's procurement process." The company said that it reached the agreement with prosecutors "for financial and business considerations" and to serve the interests of the firm's shareholders and 44,000 employees.
