FOR IMMEDIATE RELEASE                                         CIV
THURSDAY, JULY 18, 1996                            (202) 616-2765
                                               TDD (202) 514-1888


     WASHINGTON, D.C. -- Varo Inc., a subsidiary of Imo
Industries Inc., will pay the United States $2 million to settle
allegations that Varo, its Ni-Tec division, and Optic Electronic
Corporation violated the False Claims Act by delivering to the
Army components for night vision equipment that did not meet the
reliability and testing requirements of military contracts, the
Department of Justice and the Dallas, Texas, U.S. Attorney's
office announced today.  
     Assistant Attorney General Frank W. Hunger of the Civil
Division and Dallas U.S. Attorney Paul E. Coggins said the
settlement resolves a qui tam false claims lawsuit brought
against Varo, Imo Industries Inc., Ni-Tec, Optic-Electronic
Corporation and six former or current Ni-Tec employees in U.S.
District Court in Dallas, Texas.  The suit was filed by a former
employee of Ni-Tec, which Optic-Electronic founded in 1961 and
Varo later acquired.  Varo, Optic-Electronic and Ni-Tec are
located in Garland, Texas.    
     Varo will pay the United States $2 million to resolve the
matter, while Imo, its parent, guaranteed the payment.  
     The Department said the firms manufactured image intensifier
tubes used in the Army's night vision goggles and aviator's night
vision imaging systems.
     A government investigation found that over several years the
firms submitted false quality control reports to the Army,
including false failure analysis reports and false product
assurance and test reports alleging that the components met all
reliability requirements when in fact they did not.  
     Hunger said the firms worked with the Army to recall and
retest more than 1,000 image intensifier tubes from the Army's
inventory and replaced non-conforming tubes with those that met
military specifications.
     Night vision goggles are a light-weight night vision system
worn on the head that provides enhanced imagery so the wearer can
perform such tasks as walking, driving, weapon firing, short
range surveillance, map reading, vehicle maintenance and
administering medical aid with light from the moon and stars. 
The aviator's night vision imaging system is an image intensifier
system used by military helicopter pilots to aid their vision
during low level flights at night.
     The qui tam provisions of the False Claims Act permit a
private citizen to file a suit on behalf of the federal
government and collect a portion of the money if the government's
action is successful.  The suit was filed in March 1995.  The
government intervened and took over the lawsuit on May 31, 1996.
     The case was jointly investigated by the Federal Bureau of
Investigation's Dallas, Texas, office and the Defense Criminal
Investigative Service's Southwest Field Office at Fort Worth,