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Federal Contractor Misconduct Database (FCMD)

The federal government routinely awards contracts to companies with histories of misconduct, including contract fraud and other violations. POGO believes that providing this website will help to improve contracting decisions and increase public knowledge of how the government spends billions of taxpayer dollars each year. Read more…

Noncompliance With Cost Accounting Standards

In 1991, the Defense Contract Audit Agency (DCAA) found that United Technologies’ Pratt & Whitney unit had not complied with various cost accounting standards on its jet engine contracts. DCAA found that Pratt had not included any costs associated with its collaboration agreements with foreign parts suppliers in the allocation bases it used to allocate indirect costs, general and administrative expenses, and the cost of independent research and development and bid and proposal costs. In 1996, the Defense Contract Management Agency (DCMA) issued a demand for payment to Pratt in the amount of $260 million to recover the costs paid by the government to Pratt from 1984 through 1995. That demand was increased to $754.7 million in 2003 to recover costs through 2002. In 2006, Pratt paid $283 million to settle the matter.

Misconduct Type
Cost/Labor Mischarge
Enforcement Agency
Defense – General
Contracting Party
Defense - General
Court Type
N/A
Disposition
Settlement
Date of Settlement
6/5/2006
Contractors Involved Penalty
Total
United Technologies Corporation $283,000,000
Further Information Released
DOD IG Report 5/30/2014

Federal Contractor Misconduct Database