Boeing subcontractor L-3 Communications Holdings Inc. (L-3, not to be confused with wholesale telecom provider Level 3 Communications) is under federal criminal investigation after Interstate Electronics Corp., one of its subsidiaries, supplied defective parts used in CSEL emergency radios to locate downed military pilots.
Interstate Electronics Corp. purchased many of the parts from lower-level suppliers, but it is responsible for supervising the manufacturing process, testing the parts and verifying they meet quality standards.
Pentagon criminal investigators and contract-management officials now suspect that Interstate Electronics may have supplied thousands of other, potentially substandard parts over the years to a wide range of Army and Air Force weapons systems. The Los Angeles U.S. attorney’s office is leading this investigation, and its expansion means that L-3 could be subject to greater penalties if found guilty of wrongdoing. The US government (primarily the military) accounts for more than 75% of the company’s business.