Military shipbuilder Austal says investigation settlement in best interest of company
Executives with military shipbuilder Austal say settling an accounting fraud investigation is the best outcome for the company and that new financial controls have been put in place
MOBILE, Ala. — Executives with military shipbuilder Austal said settling an accounting fraud investigation, which included an agreement to pay a $24 million penalty, is the best outcome for the company and that new controls are in place.
Austal USA, a subsidiary of Australia-based Austal Limited, pleaded guilty to one count of securities fraud and one count of obstruction of a federal audit to settle an accounting fraud case. Austal USA agreed to pay a penalty of $24 million, according to the U.S. Justice Department.
Restitution will also be paid to Austal shareholders. However, the restitution will be paid from the penalty, so the company will pay a total of $24 million.
“Settling this action is the best outcome for Austal. Upon learning of this issue, Austal conducted its own independent investigation. The responsible individuals are no longer with the Company, and we have made numerous governance changes to prevent similar issues from occurring again,” John Rothwell, the former chairman of Austal Limited who now serves as non-executive director of the board, said in a statement issued by the company.
Austal builds littoral combat ships that are designed to operate in shallow coastal waters.
“The investigations focused on conduct that occurred over 8 years ago, and with a large order book of work ahead of us, we need to concentrate on the future — not the past,” Rothwell added.
The Justice Department said that from 2013 through July 2016, Austal USA misled shareholders and investors about the company’s financial condition. The Justice
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