The Defense Department said Saturday it did not yet know which companies were affected by a freeze of nearly $1.7 billion worth of contracts announced the day before in the widening arms purchase fraud scandal.
Army Lt. Col. Arnold Williams, a Pentagon spokesman, said the affected companies and the precise status of their contracts "will be provided when the information has been appropriately verified for ac-curacy.""We expect to have that verification completed on Tuesday," he added.
Defense Secretary Frank Carlucci announced on Friday he was freezing payments in nine military programs, most of them involving electronic gear for the Navy, because of court papers unsealed the day before that suggested competition for the contracts had been tainted by fraud.
Carlucci also ordered a review of all contracts held by four major defense firms mentioned in the court papers - Litton, Emhart, the Norden Systems unit of United Technologies and Hazeltine, a unit of Emerson Electric.
A fifth company, Varian Associates' Continental Electronic Manufacturing in Dallas, was suspended from doing business with the Pentagon. As a result, it cannot bid on further contracts and can be denied all or some payment on existing con-tracts.
Each of these companies was mentioned in the affidavit unsealed in Dallas on Thursday. The nine military programs in which payments have been frozen were also mentioned, though the companies involved in them have not been officially identified.
But Hazeltine, in a statement released on Saturday, said it had been informed by federal investigators that no current or former Hazeltine employees were the target of the current fraud probe.
The statement added that Hazeltine does not hold any of the contracts on which Carlucci suspended payment.
Carlucci has been under pressure from members of Congress to take decisive action since the fraud investigation became public on June 14 when searches involving Pentagon officials, defense contractors and industry consultants were carried out in 12 states and Washington.
The affidavit unsealed in Dallas - one of only two to have been unsealed so far - was one of more than 40 used to establish "probable cause" for the searches. Carlucci's action against the companies and programs named in it suggested many more contracts may be overturned as other court papers were made public in coming weeks.
Prosecutors have said they were scrutinizing 75 to 100 contracts, valued in the tens of billions of dollars, to determine if they were tainted by fraud.
The largest single weapons program on which payments are being frozen is for a $712 million system of 20 shore-based command centers for directing actions against enemy sub-marines.
According to informed sources, TRW Inc. is the prime contractor for this program, overseeing the work of up to 100 subcontractors.
In another developments related to the defense probe, the Los Angeles Times reported Saturday that retired Adm. James A. "Ace" Lyons Jr. denied in an interview that he was involved in bribery and fraud in the defense contracting industry.
Lyons, who has worked as a consultant to the McDonnell Douglas Corp. since at least last December, also accused a "very vindictive clique" of trying to destroy him and former Navy Secretary John F. Lehman.
"I'm not associated with this other crap," Lyons said.