Pa.-based military contractor faces fine

May 5, 2008 11:11:41 AM PDT
A defense contractor has pleaded guilty to obstruction and will pay $9.5 million in fines for overcharging the federal government.

Lancaster County-based Herley Industries admitted to two counts of obstructing audits of bids to supply components for Navy and Air Force radar systems.

Officials say the company will pay a $3.5 million criminal fine and $6 million to resolve related civil claims.

Herley chairman and chief executive Myron Levy says settling the case saves the company time and legal fees.

Former Herley Industries chairman Lee Blatt pleaded guilty to failing to create and maintain tax records. Blatt - who is 80 - resigned from the company in June 2006, two days after he and Herley Industries were indicted.

Herley designs and makes microwave equipment for defense, aerospace and medical use.