Sanctions for 2 Gen. Dynamics Officers Urged

The Pentagon’s inspector general recommended to Congress today that two top officers of General Dynamics Corp. be suspended or barred from government contracts because of suspected improper charges by the top U.S. defense contractor.

Joseph Sherick also told the House subcommittee on energy and commerce that the Justice Department has a lack of enthusiasm for bringing contract fraud cases developed by his office against major defense contractors.

Sherick said that Defense Department investigators are conducting criminal investigations into 45 of the top 100 military contractors. He defended his office and said that he has saved taxpayers money--including $2 billion in reduced progress payments to contractors--since being named the Pentagon’s first inspector general two years ago.

Sherick was asked what action he would take against General Dynamics, found to have improperly billed taxpayers for $244 million.

“I would suspend or debar individuals,” he said.

Asked if he was referring to David Lewis, the company chairman, and Gordon MacDonald, its chief financial officer, he said, “If you want my recommendation, I’d say yes. I’ll recommend it now.”