Chairwoman Maloney and Senator Grassley Call on TransDigm to Repay Millions It Overcharged the Defense Department
Washington, D.C. (April 18, 2022)— Rep. Carolyn B. Maloney, Chairwoman of the House Committee on Oversight and Reform, and Sen. Chuck Grassley, Ranking Member of the Senate Judiciary Committee, sent a letter to defense contractor TransDigm Group Inc. (TransDigm) demanding that the company immediately repay the $20.8 million in taxpayer funds it received by charging the Department of Defense (DOD) excessive prices on spare parts contracts.
“The excess profits TransDigm received must be returned to taxpayers so these funds can be used to ensure our military has needed supplies, such as military equipment that DOD is transferring to the Ukrainian military to help them defend their country from Russian aggression,” the Members wrote. According to DOD, “TransDigm has not repaid DOD a single dollar or indicated that it intends to do so.”
The lawmakers asked TransDigm to inform them by April 25, 2022, if they will repay the $20.8 million. If not, the lawmakers called on TransDigm to produce a range of documents no later than April 29, 2022.
On January 19, 2022, the House Oversight Committee held a hearing to examine TransDigm’s practice of charging DOD excessive prices on mission-critical spare parts for aircraft. At that hearing, Committee Members called on TransDigm to repay the excess profit. In advance of the hearing, DOD sent letters to TransDigm and its subsidiaries asking that the excess profit be repaid.
In December 2021, the DOD Office of Inspector General (OIG) issued a report on TransDigm’s pricing practices. The DOD OIG determined that TransDigm earned at least $20.8 million in excess profits on 105 of the 106 types of spare parts reviewed and concluded that these parts “were not obtained at fair and reasonable prices.”
On May 15, 2019, the House Oversight Committee held a bipartisan hearing examining a previous DOD OIG report that found TransDigm received $16.1 million in excess profits. After Committee Members called on the company to refund the money during the hearing, TransDigm repaid the full $16.1 million to DOD.
In the Senate, Senator Grassley pushed for accountability from the Pentagon amid reported price gouging by DOD contractors, including TransDigm, and welcomed the contractor’s plan to repay the Pentagon for the overcharges identified in 2019. Since then, he’s continued to press DOD for transparency on other TransDigm contracts.
Click here to read Chairwoman Maloney and Ranking Member Grassley’s letter to TransDigm.
Click here to read DOD’s letters to TransDigm and its subsidiaries.