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L-3 faces criminal probe
Report: the defense contractor faces a federal criminal probe over faulty electronic parts.
March 21, 2005: 8:27 AM EST

NEW YORK (CNN/Money) - A New York-based defense contractor is facing a federal criminal probe over faulty electronic parts built by one of its units, according to the Wall Street Journal.

The story cited company and government officials in the investigation of components for emergency radios used in locating downed military pilots.

The criminal investigation, begun late in 2004, has already resulted in a government search of an Anaheim, Calif., L-3 Communications Inc. (Research) unit in December and a limited recall of the radios called "survivor locator units" with a price tag of $10,000, the Journal reported.

A list of the additional programs for which the L-3 unit provided the parts should be released soon by the Pentagon, the Journal said.

L-3 and Boeing (Research) in September voluntarily recalled more than 1,400 radios. But investigators want them to recall another 2,000 radios, some to be installed in ground vehicles, according to the article.

The recalls threaten to derail the top-priority program that was slated to produce nearly 50,000 radios at a cost of more than $500 million for Boeing and its subcontractors, the Journal reported.

While L-3 is a subcontractor to Boeing, which provides the pilot-locator radios to the military, Boeing isn't suspected of any wrongdoing. Boeing had alerted Air Force contracting officials that the L-3 unit failed to put into place correct manufacturing and inspection procedures months before the government criminal investigation began in December, according to the Journal.

On Friday, a Boeing spokesman to the Journal that "we continue to work with the government" and subcontractors to make sure military customers "are getting quality-tested product," while a spokesman for the U.S. attorney's office in Los Angeles, which is heading the investigation, declined to comment to the Journal.  Top of page

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