RTX has to pay a $200 million fine for passing data from the F-22, F-35, B-2, E-3 and other aircraft to Russia, Iran and China

The technical leaks occurred with Russia and Iran, while trade deals for aerospace components took place with China.

The US State Department has agreed to a $200 million settlement with aerospace and defense company RTX after its employees inadvertently disclosed technical secrets and traded aerospace components for nearly all of the US military's major aircraft and missile systems with Russia, Iran and China. These include the VC-25 (Air Force One), the F-22 Raptor, the F-35 Lightning II, the B-2 Spirit stealth bombers, the B-1B Lancer and the F/A-18, F-15 and F-16 fighter jets.

The first two involved technical leaks while trading aerospace components with the PRC (People's Republic of China).

RTX “voluntarily” disclosed the cases to the government. The violations, which occurred between August 2017 and September 2023, represent 750 violations of the Arms Export Control Act and ITAR (International Traffic in Arms Regulations), which were described as “unauthorized exports of defense articles due to failure to establish proper jurisdiction and classification; unauthorized exports of defense articles, including classified defense articles; unauthorized exports of defense articles by employees by hand to prohibited destinations.”

The stunning revelations come just a day after the US Air Force announced a $1 billion contract to RTX's Raytheon to upgrade the F-22 Raptor fleet with new sensors, avionics, electronics and software to increase its survivability and relevance. The need is urgent in the face of a potential military confrontation with equal rivals and technologically comparable Russian and Chinese forces.

Voluntary information

“RTX has voluntarily disclosed all alleged violations. RTX has also cooperated with the Department's review of this matter and has made numerous improvements to its compliance program since the conduct at issue,” the statement continued. Reports cited a response from RTX calling the actions “consistent with the company's expectations,” which it announced in its second-quarter earnings report on July 25, 2024.

The company's impending disclosure may also have prompted a loosening of the agreement. Under the 36-month consent agreement, $100 million of that amount would be suspended provided the funds are used for “remedial actions to strengthen RTX's compliance.”

In addition, RTX will employ an external compliance officer for at least the next 24 months to oversee implementation of the Consent Agreement, including at least an external audit of RTX's ITAR and other compliance measures.

Violations by employees

Most of these breaches occurred when employees carried their work laptops with them on their trips abroad without paying attention to the security of the content stored on them.

For example, in May and June 2021, an RTX employee traveled to St. Petersburg, Russia, with an RTX-issued laptop that stored ITAR-controlled technical data on at least five military aircraft. Although the employee notified the company's cybersecurity team of several alerts on his laptop during the trip, they were “mistakenly dismissed” and dismissed as false positives. This may have been due to the team's transition to a new cybersecurity tool.

In another case, an RTX employee in Iran attempted to log into his system, which required the use of the local Internet provider and thus allowed access to the data. This time, however, the laptop was immediately detected and frozen by RTX's cyber cell. It later turned out that the hard drive contained technical data on the B-2 Spirit and the F-22 Raptor.

Then, between August 2017 and August 2022, Raytheon/RAY exported “without authorization” defense articles, “parts, components and technical data” of the Tomahawk LACM, RIM-162 ESSM (Evolved Sea Sparrow Missile), RIM-116 Rolling Airframe Missile, SM-2 and the Paveway-1 LGB (Laser Guided Bomb). This happened to Australia, Belgium, Canada, France, Germany, Greece, Israel, Japan, Mexico, the Netherlands, the Republic of Korea, Saudi Arabia, Singapore, Sweden, Turkey, the United Arab Emirates and the United Kingdom.

China

The Department's “charge letter” blames Collins Aerospace (formerly Rockwell Collins), an RTX company, for the majority of the violations, citing “historic systemic failures” in complying with export controls. “While all of the defendant's affiliates committed a significant number of violations, widespread weaknesses in ITAR compliance at Rockwell Collins led to the most serious violations, such as the unauthorized export of technical data to the PRC to facilitate the procurement of defense equipment from Chinese companies.”

These include “two cases” of importing and “integrating thousands” of defense items made in the PRC into “multiple U.S. and partner military platforms.” RTX told the department that its Cedar Rapids, Iowa, plant “illicitly exported technical data” of the E-3 Sentry AWACS and the KC-390 Millenium medium transport aircraft to Chinese FPE (Foreign Person Employees) in 2021 and 2022.

In January 2023, it again exported technical data on an aluminum display housing component for the F-22 to two Chinese FPEs at Collins' Shanghai facility. The “root cause” was “misclassification” and “misinterpretation” of the defense items. It identified “circuit boards” and thousands of “PWBs (printed wiring boards)” that Rockwell Collins (before it became part of RTX in 2018) and Collins purchased from “entities from the People's Republic of China.” The procurement required it to export controlled technical data.

These were used in the VC-25 Presidential Transport Aircraft (Air Force One), A-10 Thunderbolt II, B-1B Lancer, B-52 Stratofortress, C-17 Globemaster III, C-130J Super Hercules, CH-53 Stallion helicopter, F-15 Eagle, F-16 Fighting Falcon, F/A-18 Hornet, KC-46 Pegasus, KC-130, KC-135 Stratotanker, MQ-4 Triton UAV, MQ-8 Fire Scout Helicopter UAV, MQ-9 Reaper UCAV, MQ-25 Stingray and the P-8 Poseidon.

Parth Satam's career spans a decade and a half between two daily newspapers and two defence policy publications. He believes that war, as a human activity, has causes and consequences that go far beyond the question of which missile and which aircraft flies the fastest. As such, he enjoys analysing military affairs at their intersection with foreign policy, economics, technology, society and history. His work spans the entire spectrum from defence aviation, tactics, military doctrine and theory, personnel issues, West Asian and Eurasian affairs to the energy sector and space.