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Investigation launched into Acting Def. Sec. Shanahan, accused of promoting former employer Boeing at DoD

According to complaint, Shanahan promoted former employer Boeing over competitor Lockheed Martin while at DoD.
Credit: Lisa Ferdinando / DoD
U.S. Acting Secretary of Defense Patrick M. Shanahan speaks at the Center for Strategic and International Studies, Washington, D.C, March 20, 2019. (DoD photo by Lisa Ferdinando)

WASHINGTON — UPDATE: The Department of Defense Office of the Inspector General released its report into the investigation on April 25, finding that Acting Sec. Shanahan "fully complied with his ethics agreements and his ethical obligations" regarding Boeing and its competitors.

The Department of Defense’s inspector general has opened an investigation into Acting Secretary Patrick Shanahan over allegations he acted to promote his former employer Boeing at DoD, the Pentagon confirmed to WUSA9 on Wednesday.

Dwrena K. Allen, spokeswoman for the DoD Inspector General, said the IG’s office is looking at whether Shanahan violated ethics rules with comments he allegedly made about Boeing and one of its main competitors, Lockheed Martin.

“The Department of Defense Office of Inspector General has decided to investigate complaints we recently received that Acting Secretary Patrick Shanahan allegedly took actions to promote his former employer, Boeing, and disparage its competitors, allegedly in violation of ethics rules,” Allen said in a statement Wednesday. “In his recent Senate Armed Services Committee testimony, Acting Secretary Shanahan stated that he supported an investigation into these allegations. We have informed him that we have initiated this investigation.”

Shanahan has served as acting secretary of defense since January, following the departure of former Secretary of Defense Gen. Jim Mattis. Prior to that, Shanahan spent more than 30 years at Boeing, where he served in various roles – among them overseeing U.S. Army Aviation programs for the company and serving as vice president and general manager of Boeing Missile Defense Systems, as well as sitting on the Boeing Executive Council. He left the company in 2017 when President Donald Trump nominated him to become second-in-command at the Department of Defense.

MORE BOEING COVERAGE

The investigation into Shanahan follows a complaint to the inspector general’s office filed by Citizens for Responsibility and Ethics in Washington (CREW), who were themselves responding to a January report by Politico about Shanahan’s alleged criticism of Lockheed Martin’s F-35 fighter jet program while at the Department of Defense.

According to CREW’s complaint, Shanahan “reportedly praised Boeing in discussions about government contracts, said that Boeing would have done much better than its competitor Lockheed Martin had it been awarded a fighter jet contract, and repeatedly ‘dumped on’ the jet Lockheed produced.”

CREW’s complaint notes that as part of his confirmation as deputy secretary of defense, Shanahan signed an ethics agreement saying he would not “participate personally and substantially” in matters involving Boeing unless otherwise authorized.

The Office of Government Ethics maintains a list of administration officials who have been granted ethics waivers. No waiver for Shanahan is included.

The investigation into Shanahan comes amid increased scrutiny into Boeing’s cozy relationship with the U.S. government following the second crash of a Boeing 737 MAX 8 aircraft in the past six months. The FAA has ordered all 737 MAX aircraft in the U.S. grounded pending further investigation and, on Tuesday, Secretary of Transportation Elaine Chao ordered an audit into how Boeing’s aircraft was certified.

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Jordan Fischer is a digital investigative reporter for WUSA9. Follow him on Twitter at @JordanOnRecord or email him at jfischer@wusa9.com.

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