
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, July 19, 1990                   TAG: 9007190441
SECTION: NATIONAL/INTERNATIONAL                    PAGE: C-5   EDITION: METRO 
SOURCE: The Washington Post
DATELINE: WASHINGTON                                LENGTH: Short

AIR FORCE LINKED TO B-2 OVERCHARGING

The Air Force all but destroyed the government's chances of recovering up to $2 billion from the Northrop Corp. on allegations of overcharging and mismanaging the controversial B-2 "stealth" bomber program, because the service knew of the problems and took no action to remedy them, according to a secret, two-year-old Justice Department memorandum.

Justice Department officials investigating allegations against Northrop found in 1988 that the Air Force had been "fully aware" for years that the contractor was providing inaccurate cost and scheduling information about the $62 billion bomber program and knew about cost overruns and schedule delays.

"The Air Force has known of these facts for some time, but has chosen to take no remedial action," wrote U.S. Attorney Howard Daniels of the Central District of California in the Sept. 9, 1988, memo. As a result, the Justice Department would not be able to claim false representation to the Air Force in any case alleging fraud by Northrop, Daniels said.

The Justice Department also found that Air Force monitoring of Northrop's cost-charging practices was "virtually nonexistent" for the service's most expensive weapon.

Rep. John D. Dingell, D-Mich., revealed the existence of the memorandum Wednesday in a letter to Defense Secretary Richard B. Cheney calling for a court of inquiry into the Air Force's handling of the bomber program.

"Air Force officials must be held accountable at the highest levels and, where appropriate, people should be relieved of command," wrote Dingell, chairman of the House Energy and Commerce Committee's oversight and investigations panel.

by CNB