U.S. defense contractor pleads guilty to illegal exports to China

WASHINGTON — A US defense contractor pleaded guilty on Tuesday to one charge of conspiring to illegally export US Defense Department weapons plans to China, in an apparent money-saving scheme, the Justice Department said.

From 2004 to 2009 the New Jersey-based Swiss Technology had contracts with the Defense Department to make rifle and machine gun parts to use in military operations, said the Justice Department statement.

But rather than manufacture the parts itself, Swiss Technology outsourced plans for the work to China "at a much cheaper price per unit" without first obtaining the required license from the US State Department, the statement said.

"We simply can't risk that companies trying to manufacture military equipment on the cheap will expose our troops to more danger than they already face," said US Attorney Fishman.

The company has admitted that it entered into the Chinese contracts for its own financial benefit, the statement said.

The government said the fraudulent contracting meant a loss of more than $1.1 million to the Department of Defense.

Under terms of the plea agreement, Swiss Technology will pay that money back to the Department of Defense. Sentencing is currently set for November 15, 2011.