Military News

Lockheed reaches $10.3M settlement with feds

ATLANTA — Defense company Lockheed Martin Corp. reached a $10.3 million settlement with the federal government over claims that a Georgia division inflated rates used to price contracts for the Air Force and Navy between 1996 and 2000.

Prosecutors in Atlanta said Friday that the settlement resolves claims that the nation's largest military contractor mischarged costs in a deal to develop a tactical transport plane with Italian company Alenia Aerospazio.

Authorities say Lockheed charged business development and other commercial costs to government accounts.

U.S. Attorney Sally Quillian Yates said the company created a "significant unintended subsidy" for its commercial venture.

The company did not immediately respond to requests seeking comment.