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General Dynamics Ordnance and Tactical Systems, Inc. (GD-OTS) has agreed to pay $838,125 to settle allegations of civil liability stemming from compliance issues related to phosphate testing procedures in several Department of the Army contracts. The company voluntarily disclosed these issues, which have been under review by the United States Attorney’s Office for the Middle District of Pennsylvania.
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The settlement addresses a period between June 1, 2019, and April 8, 2021. During this time, GD-OTS, acting both as the successor in interest to Medico Industries and as the owner of GD-OTS-WB, submitted invoices and supporting documents for the production of 60mm, 81mm, and 120mm shell bodies. The allegations indicate that these shell bodies did not undergo phosphate testing with the required frequency as stipulated in the contracts. Upon discovering these discrepancies, GD-OTS reportedly took swift corrective measures and brought the matter to the attention of government contracting personnel.
The investigation and resolution of this case involved collaborative efforts between the Defense Criminal Investigative Service (DCIS) and the Department of the Army Criminal Investigation Division (Army CID). Assistant U.S. Attorney Tamara Haken and the Affirmative Civil Enforcement Unit of the U.S. Attorney’s Office for the Middle District of Pennsylvania were also instrumental in handling the matter.
This settlement highlights the importance of strict adherence to contractual requirements, particularly in defense manufacturing, where compliance with testing and procedural standards is critical for the integrity and quality of military equipment. For entities involved in government contracting, voluntary disclosure of compliance issues, followed by prompt corrective action, can be a crucial step in mitigating potential liabilities.
Article by Mel Anara, based upon information from the U.S. Attorney’s Office, Middle District of Pennsylvania
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