Honeywell Aerospace to pay $2 million to settle cybersecurity fraud claims

Honeywell Aerospace Inc. has agreed to pay $2,042,518 to resolve allegations that it is liable under the False Claims Act for failing to comply with cybersecurity requirements in a contract with the U.S. Department of Defense, the Justice Department announced.

Honeywell Aerospace, headquartered in Phoenix, Arizona, provides aerospace products and solutions to government and commercial customers. The company became a standalone public company on June 29, having previously operated as a business segment of Honeywell International Inc., based in Charlotte, North Carolina.

“Government contractors that obtain defense information in administering their contracts must follow required cybersecurity standards,” Assistant Attorney General Brett A. Shumate of the Justice Department’s Civil Division said in a statement. He added that the department will continue investigating potential violations of those requirements to protect critical defense information.

U.S. Attorney Russ Ferguson for the Western District of North Carolina said cybersecurity standards for federal contractors exist to protect government systems and prevent unauthorized access to government data. He said companies that seek and profit from government contracts have an obligation to safeguard sensitive information.

The settlement resolves allegations that, from April 2020 through December 2023, a Honeywell International business unit submitted false claims for payment by failing to comply with cybersecurity requirements specified in National Institute of Standards and Technology Special Publication 800-171. The requirements applied to one of Honeywell’s networks under the contract and applicable regulation.

The allegations arose from a whistleblower lawsuit filed under the False Claims Act, which allows private citizens to sue on behalf of the government and share in any resulting recovery. Under the settlement, whistleblower Rachel Tenney, a former Honeywell employee, will receive $375,823 as her share.

The resolution followed a coordinated effort involving the Justice Department’s Civil Division, Commercial Litigation Branch; the U.S. Attorney’s Office for the Western District of North Carolina; and the Defense Criminal Investigative Service, according to the department.

Senior Trial Counsel Greg Pearson and Assistant U.S. Attorney Holly Snow handled the matter.

The lawsuit is captioned United States ex rel. Rachel Tenney v. Honeywell International Inc., Civil Action No. 3:22-cv-129, in the Western District of North Carolina.

The Justice Department emphasized that the claims resolved by the settlement are allegations only and that there has been no determination of liability.