US defence secretary demands investigation into sacking of two senior executives

US Secretary of Defense Donald Rumsfeld is blocking a lease-buy deal for 100 Boeing tankers while he examines the circumstances surrounding misconduct charges that prompted Boeing last week to fire two executives, including one close to the deal.

The review is the latest crisis to challenge the legitimacy of the US Air Force's two-year-old attempt to acquire the KC-767 tanker fleet, and came just as President George Bush signed the budget law on 25 November that finally authorised the deal. The dismissals of chief financial officer Michael Sears and former air force acquisition chief Darleen Druyun on 24 November also triggered calls for a wider review of the service's procurement decisions.

Boeing says Sears was fired for talking to Druyun about future employment while she was still the air force's top acquisition official and the Pentagon's representative in contract talks for the tanker deal. Sears has denied this and Boeing's claim that he tried to cover up his actions.

The question of whether Druyun improperly tipped off Boeing on Airbus pricing data, meanwhile, remains the target of a criminal investigation by the Pentagon's inspector general. Those allegations stemmed from internal emails obtained and released in late August by Senator John McCain, an ardent opponent of the deal.

Boeing says there are no links between the misconduct charges and the tanker negotiations. Rumsfeld's review, however, means a fresh round of scrutiny that may still imperil the project.

Says Rumsfeld: "We have just read that two people have been relieved of their responsibilities by a company that we had engaged in an understanding with, and that it struck me, at least, that responsible people would want to say to themselves: 'Well, what might that mean for the department? Did something happen?'"

Keith Ashdown, spokesman for the anti-tanker lease Taxpayers for Common Sense, admits that the potential effects of the new review are unclear, but the misconduct charges alone should at least "deter any new gerrymandering or shenanigans" on the deal.

The charges also may cast a new light on Druyun's 10-year tenure as the air force's top acquisition official. Druyun had gained a reputation as a prickly combatant of defence contractors, more than once publicly calling out a contractor's misdeeds. But Druyun also supported two controversial proposals that offered big rewards for Boeing - the tanker lease and a defeated attempt in 2000 to label the C-17 as a commercial item. The latter proposal was challenged as a kick-back to Boeing and generated a rebukeby Rumsfeld.

Source: Flight International