Raytheon Fined $1 Million in Documents Case
Raytheon Co., the nation’s fourth-largest military contractor, Tuesday pleaded guilty in federal court here to one count of possession of a classified Pentagon document and agreed to pay a $1-million fine.
The giant electronics and missiles firm, based in Lexington, Mass., became the fifth major weapons supplier to admit trafficking in purloined Pentagon papers in a case dubbed Operation Uncover.
The case uncovered a broad conspiracy to trade classified Pentagon documents among military contractors. Boeing Co., RCA Corp., Hughes Aircraft Co. and Grumman Corp. all have recently pleaded guilty to similar document-swapping charges and paid multimillion-dollar fines.
Investigators said that John R. Kiely, a former Raytheon marketing analyst, obtained a secret Air Force internal report making recommendations about weapons procurement. Kiely allegedly violated federal security regulations by possessing the document and sharing it with representatives of other contractors.
“This information is not releasable to defense contractors,” Defense Department Inspector General Susan J. Crawford said. “Possession of this very sensitive information would provide those contractors with the results of internal (Pentagon) deliberations and plans.”
Investigators said that Raytheon’s mishandling of classified documents occurred between 1979 and 1985. They noted that the company did not profit directly from possession of the reports nor is there any evidence the firm paid any government officials to obtain them.
Kiely, who retired from Raytheon in January, has not been charged with any crime, but prosecutors said he remained under investigation. He could not be reached for comment.
Raytheon officials called the case an aberration from the company’s ethics policy and said measures had been taken to prevent a recurrence.
“Our position is that, as the settlement states, this matter involved conduct that occurred more than five years ago, was completely contrary to company policy and was without the knowledge of any company director or officer,” said a Raytheon spokeswoman. She said the company did not agree with all the allegations but chose to settle and pay the fine to avoid costly litigation. Raytheon’s $1-million fine was the smallest penalty levied against any of the five firms.
