Lockheed Martin PAC faces embezzlement probe

COLLEGE PARK, Md. -- Federal elections officials will audit Lockheed Martin's political action committee after the defense contractor accused a former employee of embezzling $170,000 from the fund. For two years beginning November 2001, the committee's assistant treasurer wrote himself checks and made it appear they had been sent to political candidates, Lockheed spokesman Tom Jurkowsky said Wednesday. The employee, fired earlier this month, intercepted several letters from the Federal Elections Commission noting discrepancies in the PAC's filings and those of political candidates who never received the money, Jurkowsky said.

Lockheed discovered the problem when the FEC called the employee's supervisor to report that its letters had gone unanswered.

Jurkowsky refused to identify the assistant treasurer but previous FEC filings list Kenneth D. Phelps III of Alexandria as the PAC's assistant treasurer. Jurkowsky said Phelps left the company on Jan. 9, but would not say why.

A message left at the home of a Kenneth Phelps in Alexandria, Va., was not immediately returned.

FEC spokesman George Smaragdis said the agency would pursue a civil case, which could include fines, if it finds any wrongdoing. Jurkowsky said Lockheed has already paid $8,700 in late filing fees related to the case.

Lockheed has since moved the PAC's check-writing operations to the company's central office.

The PAC, based in Crystal City, Va., distributes about $1 million to candidates during each two-year congressional election cycle, Jurkowsky said.