Boeing-owned drone maker Insitu Inc. agreed to pay $25 million to settle allegations that it used recycled parts instead of new parts in military drones.
The U.S. Attorney’s Office for the Western District of Washington said the parts were put into military drones that Insitu built for the U.S. Special Operations Command (SOCOM) and the Department of the Navy between 2009 and 2017.
Insitu violated the False Claims Act since the company knowingly submitted materially false cost and pricing data for multiple contracts with the U.S. SOCOM and U.S Navy to supply Unmanned Aerial Vehicles (UAVs) or drones.
The U.S. Department of Justice (DOJ) said Insitu vowed to provide new parts for military drones when it was awarded seven separate contracts. However, the firm later delivered only used, reconditioned, or recycled parts.
In a statement, DOJ Civil Division Acting Assistant Attorney General Jeffrey Bossert Clark said, “We expect companies that seek to do business with the government to provide complete and accurate information so contract prices can be negotiated on a level playing field.”