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Northrop Pleads Guilty to Falsifying Tests on Harrier Jet, Missile Parts

February 28, 1990 GMT

LOS ANGELES (AP) _ Northrop Corp. pleaded guilty Tuesday to nearly three dozen federal counts related to falsified testing of parts for the AV-8B Harrier jet and cruise missile components, and agreed to a $17 million fine.

In a plea bargain, the defense contractor entered guilty pleas through attorney Richard Sauber to 34 counts of making false statements to the government.

Assistant U.S. Attorney William Fahey called the resolution of the case ″a very significant victory in our efforts to combat defense contractor fraud and mismanagement.″

Prosecutors said charges would be dropped against Joseph Yamron, 62, vice president and general manager of Northrop’s Norwood, Mass.-based Precision Products Division, and Leopold Engler, 60, vice president of instrument operations there.

Earlier in the day, Charles Gonsalves, a former Northrop Corp. plant manager, pleaded guilty in U.S. District Court to charges of falsifying test data on components of cruise missile guidance systems.

″The U.S. government and Northrop Corp. reached a complex compromise today under which the government agreed to withdraw various charges the company had been contesting for over a year, and Northrop in turn agreed to pay a $17 million dollar fine for charges arising out of actions by some employees it subsequently fired in 1987 from its now closed Western Services Department,″ Northrop said in a statement issued from its headquarters.

Northrop asserted that, according to the military services that use the Harrier and the cruise missile, ″both systems have performed satisfactorily in flight operations.″

Regarding the Western Services Department and Precision Products Division, the company said the government dropped 139 counts of making false statements and two counts of conspiracy, and Northrop agreed to plead guilty to 34 false statements that had been made by the former employees at the department.

Gonsalves entered the plea under an agreement with prosecutors under which he would be sentenced to no more than three years in prison and be fined a maximum of $1.2 million.

Gonsalves, once supervisor of the Western Services Department, pleaded guilty to one conspiracy count and seven counts of making false statements to the government from 1984 to 1987.

Sentencing was set for May 1 before Judge Pamela Ann Rymer.

Northrop Corp. and five current and former employees were indicted April 11, 1989, on charges of conspiring to defraud the government through the cruise missile and the Navy’s AV-8B Harrier jump jet program.

Gonsalves entered his plea pertaining to the cruise missile systems as a jury was about to hear the case against him, quality assurance supervisor Cheryl Hannan and Northrop on charges related to the Harrier parts.

Prosecutors agreed to a diversion program for Hannan, who was charged in both the Harrier and missile aspects of the case, and charges will be dropped if she completes the program to the satisfaction of probation officials.

Howard Hyde, chief engineer at Western Services, pleaded guilty last May to charges involving falsifying tests on the jet parts.

The 167-count indictment charged that the company and five others conspired between the 1970s and 1989 to install parts for the cruise missile’s flight data transmitter that failed to meet government specifications.

It also said the transmitter required extensive reliability testing that was not performed. Instead, the indictment said, three of the defendants supervised false testing and falsification of test results.

Concerning the Harrier jet program, the indictment accused the defendants of failing between 1981 and 1986 to conduct vibration tests of the jet’s rate sensor assemblies at levels required by contract. The assemblies are part of the flight stabilization system of the attack jet.

Yamron and Engler, who have been on administrative leave to prepare their defense, will return to their former duties, Northrop said.

″From the time last April when the government filed its charges against the division, Mr. Yamron and Mr. Engler, Northrop has stated the charges were unwarranted and strongly disputed any allegations of criminal behaviour by the Precision Products Division or by those individuals,″ Northrop said.