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Pentagon Widens Procurement Investigation

By Renae Merle
Washington Post Staff Writer
Wednesday, November 10, 2004; Page E01

The Pentagon's investigation into the actions of a former Air Force official who admitted giving preferential treatment to Boeing Co. for several years is expanding into a broad review of how the military buys weapons.

The effort could turn into the widest examination of the Pentagon procurement system since the 1980s influence-peddling scandal known as Ill Wind. The scrutiny was spurred by Darleen A. Druyun's admission last month that she gave preferential treatment to Boeing after the company hired her daughter and son-in-law. Druyun was sentenced to nine months in prison.

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The Pentagon will broaden its inquiry of procurement procedures beyond the Air Force to all the services, said Michael W. Wynne, the Pentagon's acting acquisition chief. The investigation will consider what lapses in the Air Force system allowed Druyun to favor Boeing, whether those problems still exist and whether similar problems exist in the other services, he said. If the task force finds problems, it will recommend ways to address them, he said.

"This is an egregious problem. It detracts from all of us," Wynne said. "The purpose of this review is to provide advice on how [Druyun] accrued enough power" to take illegal action undetected. "We are looking across the services to see if there are other people who accrued this type of power."

The Pentagon has begun two large-scale investigations under separate groups. The Defense Science Board, a Pentagon advisory group, will study the procurement systems. The Defense Contract Management Agency will lead a survey of all the contracting-related actions taken by Druyun during her nine years as the Air Force's deputy acquisition chief, starting in 1993. That will include her decisions on company bonuses and contract extensions, defense officials said. The inquiry will likely be far-ranging because Druyun had a role in hundreds of contracts before she retired in November 2002.

Air Force officials have said they made significant changes to the procurement system after Druyun retired and joined Boeing as a vice president. Her position was eliminated and her power dispersed to a wide range of lower-ranking officials. But senior Air Force officials felt a Department of Defense-level review was necessary to move beyond the scandal.

Druyun's revelations are also likely to keep Boeing's space business in limbo. Last year, the Air Force suspended Boeing from bidding on space contracts after the company admitted that some of its employees had proprietary Lockheed Martin Corp. documents during a competition for a rocket-launch contract.

While Air Force officials have repeatedly said they hoped to lift the suspension soon, that now seems unlikely. "It's really hard for the Air Force to move forward now that this has all come out," Wynne said. "We've got to sweep away any allegations of ethical misconduct."

The Pentagon has also asked the Government Accountability Office to handle protests filed by Boeing's competitors after Druyun admitted that her relationship with Boeing tainted her decision to award the company a $4 billion contract to upgrade the electronics on the C-130 transport plane. Originally, Lockheed, L-3 Communications Holdings Inc. and BAE Systems PLC filed protests on the award with the Air Force, but those have been withdrawn and will be refiled with the GAO, Wynne said. Lockheed's protest included two classified programs, which will not be refiled with the GAO but will be addressed by the Air Force, Wynne said.

Boeing officials have said the company is not aware of receiving preferential treatment.

The Pentagon's inspector general is also investigating Druyun's actions. Wynne said the review should include whether Druyun gave preferential treatment to defense contractors who employed her husband. William S. Druyun retired from a mid-level position at General Dynamics Corp. this year.

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