U.S. defense contractor RTX reached a settlement deal with the U.S. government to return unlawful gains on its international clients, including US$250 million from Taiwan’s defense procurement deal.
Bloomberg reported earlier this year that a U.S. federal audit uncovered price gouging by defense contractor RTX, formerly known as Raytheon, in foreign military sales, resulting in significant losses for allied nations.
Following an investigation by the U.S. Department of Justice, RTX reached a settlement with the U.S. government, agreeing to pay US$1.24 billion in restitution and return profits gained from inflated prices to affected parties.
At the time, the specific countries impacted by the incident were unnamed. However, it has since come to light that Taiwan was one of the affected buyers, having been overcharged by roughly US$250 million in two procurement deals: a radar system in 2013, and the Patriot missile system in 2017, which is a key component of Taiwan’s surface to air defense. Taiwan has procured various military equipment from RTX over the years, which raises questions about whether there are other overcharging incidents.
Taiwan’s defense ministry has announced that the U.S. government is seeking compensation on Taiwan’s behalf from RTX, and ministry spokesperson Major General Sun Li-fang (孫立方) stated that the case demonstrates the robust anti-corruption mechanisms in place for U.S.-Taiwan arms sales agreements.
On the other hand, DPP Legislator Wang Ting-yu (王定宇) questioned whether Taiwan’s military should first aim for an improved defense procurement processes.