A Delaware-based defense and aerospace company has settled a case with U.S. agencies over government allegations that the firm neglected its cybersecurity obligations in its contracts.ILC — the name the government uses to collectively refer to ILC Dover and ILC Astrospace — agreed to pay $13 million to resolve the False Claims Act allegations involving its contracts with the Department of the Army, Missile Defense Agency and National Aeronautics and Space Administration.ILC, according to the government, submitted false or fraudulent claims for payment on contracts with the agencies because it knew it hadn’t complied with the contracts’ cybersecurity requirements over a period between 2018 and 2024.For instance, ILC allegedly used a third-party company to store sensitive data in the cloud without proper safeguards, and didn’t develop and update mandated security plans for each of its covered information systems.“The best response to cyberattacks is to prevent them from happening in the first place,” Benjamin Wallace, U.S. Attorney for the District of Delaware, said in a news release Tuesday. “The obligations that ILC violated exist to prevent bad actors from taking advantage of the United States’ technical innovation.” American industrial manufacturing giant Ingersoll Rand, the parent company of ILC Dover, said it inherited the issue when it purchased the firm.“We became aware of this matter following our acquisition of ILC Dover in June 2024, took prompt action to address the identified issues, and were in compliance with applicable requirements by October 2024,” said Sara Hasell, a spokesperson for Ingersoll Rand. “We have agreed to resolve this matter with the U.S. Department of Justice without an admission of liability and remain committed to maintaining strong cybersecurity practices.”The $13 million settlement is one of the bigger settlements since the Justice Department began using the False Claims Act in 2022 to penalize contractors over cybersecurity shortcomings. The False Claims Act is a Civil War-era law passed to deal with fraudulent contractors.“To protect sensitive information from cyber threats, defense and aerospace contractors must comply with the cybersecurity requirements in their federal contracts and subcontracts,” said Assistant Attorney General Brett Shumate of the Justice Department’s Civil Division. Under the law, a private citizen can raise allegations that the contractor defrauded the government and is entitled to receive a portion of any settlement. The whistleblower in the ILC case, Philip Root, the company’s former director of cybersecurity, will receive $2.35 million.Government contract attorneys say that a forthcoming regulatory overhaul could expose more companies to False Claims Act punishments.The post Defense and aerospace firm settles with government over allegedly failing to meet cybersecurity contract requirements appeared first on CyberScoop.