(CN) - Lockheed Martin will pay a $10.5 million settlement for overbilling the government on a multibillion-dollar contract to build Titan IV rockets, though the company did not admit it intentionally scammed taxpayers.
Lockheed reported the error after discovering two problematic billing methods during an internal audit, according to the U.S. Attorney's Office in Los Angeles. The company cooperated with the federal False Claims Act investigation that followed. The payment of $10.5 million is double the interest Lockheed would have made by keeping the overpayments.
The overcharges resulted from Lockheed's post-contract, secret revision of the way it calculated the cost of the rockets it sold. That change increased government payments between October 1998 and December 2001.
And in August 2000, Lockheed billed the government for millions more after it lowered the contract's liquidation rate, which dictated the amount the government would owe when Lockheed delivered rockets, after taking the interim payments into account.
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