Prosecuting Agency:
U.S. Securities and Exchange Commission
Type of Action:
SEC Administrative Proceeding
Docket or Case Number:
3-22256
Name of Prosecuting Attorneys:
Irene Gutierrez, SEC Headquarters
Ilana Z. Sultan, SEC Headquarters
Eric Heining, SEC Headquarters
Sonali Singh, SEC Headquarters
Tracy L. Price, SEC Headquarters
US Assisting Agencies: Unknown
Foreign Enforcement Action/Investigation: Unknown
Foreign Assisting Agencies: Unknown
Origin of the Proceeding:
Unknown
Whistleblower:
Unknown
Case Status:
Resolved
Summary
RTX Corporation, headquartered in Arlington, Virginia, was an aerospace and defense company that provided defense systems and services for military and government customers worldwide. RTX was formerly known as Raytheon Technologies Corporation, which formed in 2020 when United Technologies Corp. (UTC) merged with Raytheon Company. As a result of the merger, Raytheon Company became a wholly owned subsidiary of UTC, which changed its name to Raytheon Technologies Corp. RTX's shares were registered with the SEC and traded on the New York Stock Exchange under the ticker symbol “RTX.”
Thales-Raytheon Systems Company LLC was a joint venture formed in 2000 between Raytheon and the French company Thales Group, each owning 50% of the joint venture. Thales-Raytheon was controlled by and reported into Raytheon, and in 2016, it was restructured and became a wholly owned subsidiary of Raytheon.
According to the documents in this case, Raytheon used sham subcontracts with a supplier to pay bribes of nearly $2 million to Qatari military and other officials from 2011 to 2017 to obtain Qatari military defense contracts. Additionally, between the early 2000s and 2020, Raytheon paid more than $30 million to a Qatari agent who was a relative of the Qatari Emir and a member of the Council of the Ruling Family who could purportedly help Raytheon navigate the opaque Qatari defense contracting system. Raytheon used this agent despite his lack of any prior background in military defense contracting and Raytheon's own due diligence that revealed red flags of heightened corruption risks. In all, Raytheon made profits of approximately $37 million in connection with these schemes.
In a settled administrative proceeding initiated on October 16, 2024, the SEC ordered RTX to cease and desist violations of the antibribery, books and records, and internal controls provisions of the FCPA. Under the terms of the settlement, RTX agreed to pay disgorgement of $37,400,090 plus prejudgment interest of $11,786,208 and a civil monetary penalty in the amount of $75,000,000 and further agreed to retain an independent compliance monitor for a term of three years. The SEC agreed to offset $22,500,000 from the civil penalty based on payments made to the DOJ in its parallel enforcement action. The SEC noted the company's cooperation and remediation, but only after a period of uncooperativeness.
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