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Defense Firm Pays NASA $7.1 Million to End Probe

June 11, 2003|From Reuters

Defense contractor Lockheed Martin Corp. has paid $7.1 million to NASA to settle charges it improperly claimed reimbursements from the U.S. space agency, the U.S. attorney in Houston said Tuesday.

The deal ends a nine-year investigation by NASA's Office of Inspector General into a Lockheed unit that held a $1.14-billion contract to support the space shuttle program at the Johnson Space Center in Houston.

The contract included a 10-year lease on two buildings owned by Lockheed Martin.

The U.S. believed that Lockheed hid $7.1 million of interest-related debt in lease reimbursement claims it submitted to the government, a practice that is prohibited, said Michael Shelby, U.S. attorney for the Southern District of Texas.

A spokesman for Lockheed Martin said the company believes it did nothing wrong and it admitted no wrongdoing in agreeing to the settlement.

The investigation started in 1994 after Lockheed disclosed that an employee in charge of contract administration had embezzled more than $632,000 from a NASA contract.

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