Aerojet Rocketdyne Fined 137 Billion For Ignoring Cybersecurity Compliance And Requirements

Aerojet is accused of violating a contract agreement with the US Federal government. (photo: twitter @astrosociety)

JAKARTA - The US Department of Justice announced on Friday, July 8 that rocket engine maker Aerojet Rocketdyne has agreed to pay $9 million to settle charges of misrepresenting its compliance with cybersecurity requirements in federal government contracts.

"Aerojets provide propulsion and power systems for launch vehicles, missiles and satellites and other space vehicles to the Pentagon, NASA and other federal agencies," the Justice Department said.

The settlement resolves a 2015 lawsuit filed by former Aerojet employee, Brian Markus, under the whistleblower provisions of the False Claims Act.

"Markus and Aerojet reached a settlement of the case on the second day of the trial in April," the Justice Department said. He will receive 2.61 million US dollars as his share of the settlement of the case. The settlement was approved on July 5 by the US District Court in California.

The court lawsuit from Markus says that between July 2013 and September 2015, Aerojet received more than $2.6 billion in government funding by "frauding" Department of Defense and National Aeronautics and Space Administration (NASA) contracts that are "a critical component of America's national defense and aerospace program. They misrepresent it in complying with cybersecurity regulations.

After the 2013 cyberattack, Aerojet hired Mark as a senior cybersecurity official, but Markus said he didn't have the budget or staff Aerojet promised. He also claimed Aerojet in 2015 hid from its board that the company did not comply with cybersecurity requirements.

Aerojet said in its April court defense that it filed "made numerous detailed disclosures to the relevant government agencies regarding its compliance status with these cybersecurity standards in 2014, 2015, and beyond."

Aerojet Rocketdyne did not admit any wrongdoing as part of the settlement. Aerojet did not comment on the report.

"Whistleblowers with inside information and technical expertise can provide critical assistance in identifying cybersecurity failures and breaches," said Assistant Deputy Chief Attorney General Brian Boynton.