More stuff on the Boeing scam

The former USAF procurement executive who signed the KC-767 deal with Boeing and later Boeing executive (gee, that’s a corruption-avoiding career change :rolleyes: ), Darleen Druyun, has now officially been sentenced to nine months in prison. But there’s more fun from her…

From the Seattle Post Intelligencer (that’s a newspaper, don’t be fooled by the somewhat weird name).
http://seattlepi.nwsource.com/business/193453_tanker02.html

Druyun admits more misdeeds
Other contracts, not just tanker deal, were steered Boeing’s way

SEATTLE POST-INTELLIGENCER STAFF AND NEWS SERVICES

A former Air Force procurement official admitted in federal court yesterday that before she went to work for The Boeing Co. in January 2003 she helped the company obtain several other military contracts — not just the tanker deal that has embroiled the aerospace giant in a yearlong ethics scandal.

Those other contracts involved Boeing-built NATO surveillance planes, Boeing’s C-17 transport and a $4 billion contract that Boeing won over Lockheed Martin to upgrade software for the C-130 plane.

The Air Force said it will investigate those contracts. Additional investigations are also being conducted by the Justice Department and the Pentagon.

“I sincerely want to apologize to my nation, my family and friends and to the court for what I have done,” Darleen Druyun, 56, told U.S. District Judge T.S. Ellis III in Alexandria, Va.

Ellis sentenced Druyun to nine months in prison. She also must pay a $5,000 fine, serve three years of supervised release, including seven months of community confinement, and perform 150 hours of community service.

Boeing said Druyun’s admissions to the court came as a “total surprise.”

The Chicago-based company said in a statement it would continue to work with the U.S. Attorney’s Office to investigate further the “circumstances of Ms. Druyun’s hiring.”

“I have the highest confidence in the integrity and systems of The Boeing Company and we will exert all energy to address any inadequacies that need to be corrected,” Boeing Chief Executive Harry Stonecipher said in the statement.

Now that Druyun has been sentenced, a plea agreement is next expected to be worked out for Mike Sears, Boeing’s former chief financial officer who improperly offered Druyun a top Boeing job while she was still negotiating the tanker deal for the Air Force in the fall of 2002.

Sears and Druyun were fired by Boeing late last year. Boeing Chairman Phil Condit resigned a week later, and Stonecipher came out of retirement to lead the company.

As a result of the wrongdoing by Sears and Druyun, the Pentagon has put the $23 billion tanker deal on hold while it examines other alternatives.

In her plea agreement, Druyun said that Boeing would not have been selected for some military projects, or would have received lower payments, if not for her efforts to obtain jobs for herself, her daughter and her son-in-law.

The hope of obtaining the jobs, she said, led her to favor Boeing in the selection and pricing of several major projects, including a $20 billion leasing agreement for 100 airborne tankers, a 2002 restructuring of a NATO early warning system, a $4 billion upgrade of the C-130 aircraft, and a $412 million payment on a C-17 contract.

The new facts, and an admission by Druyun that she had also misled investigators after pleading guilty to one count of conspiracy last April, resulted in Druyun having her sentence increased. The information came out in an amended statement made public at the hearing and elicited gasps when read by Assistant U.S. Attorney Robert Wiechering.

Druyun also admitted providing Boeing with proprietary pricing data supplied by European Aeronautic, Defense & Space Co., Europe’s biggest aerospace company, during the tanker negotiations.

“She did this as a parting gift to Boeing and to ingratiate herself into Boeing,” said Wiechering.

Druyun was the No. 2 acquisition official for the Air Force.

Prosecutors disclosed she failed a lie detector test and was forced to admit she helped Boeing with other contracts.

Druyun revised her guilty plea at the sentencing hearing, admitting that she had not fully cooperated with prosecutors.

Specifically, Druyun agreed to a higher price for Boeing aerial refueling tankers than she thought appropriate and gave proprietary pricing data to Boeing “as a ‘parting gift to Boeing’ and because of her desire to ingratiate herself with Boeing, her future employer,” according to court papers signed by Druyun and the government. That deal is currently on hold.

In addition, Druyun admitted to selecting Boeing over four others for a $4 billion program to upgrade C-130 avionics out of gratitude to Boeing for having hired her daughter and son-in-law. Druyun now thinks that an objective analysis would not have given Boeing the contract, court papers said.

A $100 million payment to Boeing for a NATO early warning system was also cited in the court papers, in which Druyun admitted that she felt a lower settlement amount was more appropriate. That payment is being renegotiated by the Air Force.

At the moment, the Department of Defense Inspector General’s office is investigating all deals negotiated by Druyun, once one of the highest-ranking women at the Pentagon and with a career that had brought her both fame and numerous awards.

“We view this as a case of an individual who engaged in personal misconduct,” said Col. Dewey Ford, an Air Force spokesman. “Independent of this issue, our Air Force senior leadership has implemented changes within our acquisition community that will reduce the likelihood that this will ever happen again.

Thomas Jurkowsky, a Lockheed spokesman, said, “We’re concerned to learn about this development but have confidence the government will fully explore this entire issue. It would be inappropriate to comment further until we have a clearer understanding of all the facts.”

“We are at war and your position was all the more important,” federal judge Ellis told Druyun at her sentencing. “This case must stand as an example given the high office you held.”

Boeing paid Druyun a $50,000 signing bonus and a $250,000-a- year salary, court papers show.

Assistant U.S. Attorney Wiechering had recommended that Druyun be sentenced to 16 months in prison, saying Druyun’s conduct involved some of the Pentagon’s most important weapons systems.

Prosecutors have been using information Druyun provided to target Sears, who in July agreed to plead guilty to aiding in the illegal hiring of Druyun, according to court papers. An Aug. 11 hearing on his plea deal was delayed and hasn’t been rescheduled.

Sears “is still under investigation by our office,” Wiechering told Ellis. “We expect a resolution of that case in the near future.”

P-I reporter James Wallace contributed to this report by The New York Times and Bloomberg News.