The Department of Justice announced on Tuesday that Austal USA, a shipbuilding company based in Alabama, and a wholly owned subsidiary of Australian company Austal Limited, has pleaded guilty to federal charges of securities fraud and obstructing a Pentagon audit.

As part of the settlement, the company has agreed to pay $24 million to resolve the case.

"Austal USA, a Mobile, Alabama-based shipbuilder that constructs vessels for the US Navy and US Coast Guard, pleaded guilty today and has agreed to pay $24 million to resolve an investigation by the Justice Department," the release said.

U.S. Navy Shipbuilder Pleads Guilty to Financial Accounting Fraud Scheme and Obstructing a Defense Department Audit

🔗: https://t.co/XgcUatpds9 pic.twitter.com/kcYMnkQhpB

— Criminal Division (@DOJCrimDiv) August 27, 2024

The guilty plea by Austal USA is related to an accounting fraud scheme and efforts to obstruct the Defense Contract Audit Agency (DCAA) during a financial capability audit, as explained by the Justice Department.

"Austal USA, a shipbuilder for the US military, engaged in a years-long scheme to illegally inflate its profits on ships the company was building for the US Navy, reporting false financial results to investors, lenders, and its auditors," Principal Deputy Assistant Attorney General Nicole Argentieri, head of the Justice Department’s Criminal Division, said in the release.

According to court documents, between approximately 2013 and July 2016, Austal USA and its co-conspirators conspired to mislead Austal Limited's shareholders, independent financial statement auditors, and the investing public about the company's financial health. 

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