Two Plead Guilty in Defense Fraud
Oct. 18, 1988
PITTSBURGH (AP) _ Two former officers of a western Pennsylvania firm pleaded guilty Monday to providing false information on a defense contract that inflated the cost of a fighter plane's radar by $1.8 million.
Wendell E. Hager, 58, of Greensburg, former president of Nuclear Automation Inc. of North Huntingdon, Westmoreland County, and H. Ray Rambler, 50, of Greenville, S.C., former vice president of operations, entered guilty pleas before U.S. District Judge Donald Ziegler.
The men pleaded guilty to two counts of an 83-count federal indictment handed up June 15. U.S. Attorney J. Alan Johnson said the Justice Department will dismiss the remaining counts in return.
Assistant U.S. Attorney Peter V. Marcoline said the men falsified documents when presenting Hughes Aircraft Corp. of El Segundo, Calif., with hourly costs for the manufacture of actuators used in the radar units of F-15 fighter planes.
Johnson said the actuator is a hydraulically operated component of the radar system located in the nose of the F-15. Each fighter has two actuators to move the radar horizontally and vertically, he said.
In seeking payments from Sept. 1, 1982, to Oct. 1, 1986, the men had Nuclear Automation's controller inflate the time needed to build each actuator from 70 to 93 hours, resulting in an overpayment by the government to Hughes, according to Marcoline.
Johnson said the actuators were priced at about $6,500 each when they averaged about $5,100 each to manufacture.
Nuclear Automation, owned by Esterline Corp. of Darien, Conn., until November 1984, when it was acquired by Neoax Inc. of Stamford, Conn., is still making the devices for the Air Force, the government said.
Hager and Rambler were released on bond pending completion of presentence reports. Officials said they are to be sentenced Nov. 30 and face a maximum of five years in prison and a $10,000 fine on each count.