TransDigm To Refund $16 Million to DOD as a Result of Committee Investigation

May 24, 2019
Press Release

Washington, D.C. (May 24, 2019)—Today, Rep. Elijah E. Cummings, the Chairman of the Committee on Oversight and Reform, issued the following statement after TransDigm—a defense contractor that overcharged the Pentagon for dozens of spare parts for military aircraft—agreed to repay $16 million after last week’s Committee hearing with company executives:

“Today’s decision by TransDigm to refund millions of dollars in blatant overcharges would not have happened without the hearing in the Oversight Committee last week.  This is solid, bread-and-butter oversight that helps our troops and the American taxpayers.  We saved more money today for the American people than our Committee’s entire budget for the year.  I commend Rep. Ro Khanna and Rep. Jackie Speier, who have been on top of this issue for years, and the Inspector General’s office for its great work.  While this is a good first step, we must do even more in the future to prevent unscrupulous contractors from holding us hostage through abusive monopoly contracts.  I look forward to working with my colleagues on both sides of the aisle on common-sense reforms.”

This check is one installment of several totaling $16.1 million that TransDigm is

now returning to the American taxpayers after the Oversight Committee’s hearing last week.

On May 15, 2019, the Committee held a hearing with TransDigm officials highlighting how the company overcharged the Defense Department for mission-critical aircraft parts and diverted resources that could have been used for other military needs.  

Cummings released a memo that day summarizing new documents obtained by the Committee regarding TransDigm’s extreme profit margins, as well as information from whistleblowers and former company officials about efforts to conceal data about the company’s true costs to manufacture these parts. 

During the hearing, multiple Committee Members demanded that TransDigm pay back these funds to the American taxpayers.

Assistant Secretary of Defense for Acquisition Kevin Fahey testified that TransDigm was “gouging the taxpayers with their sickening business practices.” 

He added, “Every time you’re paying a cost that is outrageous, you could be spending that money somewhere else.  For example, if we got our $16 million back, we could be buying other spare parts to increase readiness.”

Committee Member Ro Khanna asked the Defense Department Inspector General’s Office to investigate TransDigm in 2017, and the IG issued its report in February of this year.

 

116th Congress