Northrop Grumman to pay $27 million to settle overbilling allegations

WASHINGTON (Reuters) - Northrop Grumman Corp NOC.N will pay $27.45 million to settle allegations it overstated the number of hours its employees worked on two U.S. Air Force contracts, the U.S. Justice Department said on Friday.

In a statement, the department said Northrop Grumman violated the False Claims Act by overbilling the Air Force for hours worked on the contracts involving battlefield communications.

Northrop said in a statement that former employees deployed to the Middle East between 2010 and 2013 were responsible for the overcharging. It said the company had investigated the issue and reported it to the government in 2013.

“The improper charging was in direct violation of company policies, procedures and training,” Northrop said, adding it had taken disciplinary action against those responsible, including termination of employment.

“There should be no doubt, the misconduct of those former employees does not reflect the values of our company,” Northrop said.

Reporting by Eric Beech; editing by David Alexander, Rosalba O’Brien and Tom Brown