The Pentagon’s Inspector General’s office has cleared Acting Defense Secretary Patrick Shanahan of any potential ethics violations related to his past employment at Boeing [BA], according to a report released April 25.
“We did not substantiate any of the allegations,” said the Department of Defense Office of the Inspector General (DoD OIG) in a statement Thursday. “We determined that Mr. Shanahan fully complied with his ethics agreements and his ethical obligations regarding Boeing and its competitors.”
Shanahan “did not make the alleged comments and did not promote Boeing, or disparage its competitors,” the report’s conclusion said. “While Mr. Shanahan did routinely refer to his prior industry experience in meetings, witnesses interpreted it, and told us, that he was doing it to describe his experience and to improve Government management of DoD programs, rather than to promote Boeing or its products. We also determined that Mr. Shanahan’s comments about Boeing’s competitors were directed at holding contractors accountable and saving the Government money, consistent with his duties as the Deputy Secretary of Defense, rather than to disparage particular companies and individuals, or to promote Boeing.”
The Wall Street Journal first reported Thursday that Shanahan had been cleared of any ethics violations. The DOD IG launched its investigation on March 15, and interviewed Shanahan along with 33 witnesses, the report said (Defense Daily, March 20). The team analyzed over 5,600 pages of unclassified documents and about 1,700 pages of classified documents related to the allegations and relevant major defense acquisition systems. It outlines various allegations that were made against Shanahan, to include the most reported claim that he had denigrated the Lockheed Martin [LMT]-built F-35 Joint Strike Fighter.
According to the report, the investigators determined that “Mr. Shanahan’s comments related to the F-35 program” – rather than the aircraft – “and its performance, and were consistent with other comments about problems in the F-35 program made by other senior DoD officials.”
The report also details other alleged instances that claimed Shanahan urged Marine Commandant Gen. Robert Neller to procure Boeing’s F/A-18 Super Hornet, and urged Air Force Chief of Staff Gen. David Goldfein to buy new Boeing F-15EX aircraft, threatening to cut other Air Force programs if he did not do so. The investigators found no evidence that Shanahan made those comments to Neller and Goldfein, and found he had only participated in “broad policy discussions” related to the mix of fourth- and fifth-generation aircraft.
Additionally, the DoD IG investigated the following allegations: That Shanahan met with Space-X CEO Elon Musk, whose company was in competition with Boeing on a launch vehicle contract; that the acting defense secretary suggested that a DoD official visit a Boeing simulation facility; and that he discussed a classified matter related to a Boeing product. The DoD OIG determined that no ethics violations occurred in these instances.
The investigation’s conclusion could pave the way for the Trump administration to officially nominate Shanahan to be the next defense secretary. Shanahan has served in an acting capacity since Jan. 1, when President Trump let former Secretary Jim Mattis go two months earlier than the retired Marine general had previously put as his resignation date.
For months now, lawmakers have expressed concern that Shanahan’s past at Boeing could cause potential ethics issues should he become the Pentagon’s top civilian (Defense Daily, Jan. 3). However, Senate Armed Services Committee (SASC) Chairman Jim Inhofe (R-Okla.), who emerged early this year as a slight critic of Shanahan, has spoken more favorably of the acting defense secretary of late. Defense Daily reached out to Inhofe for comment.
SASC Ranking Member Sen. Jack Reed (D-R.I.) said in a Thursday statement: “The senior leadership of DOD oversees hundreds of billions of taxpayer dollars, and to do that job well they must be above reproach and focused only on the country’s interests. In this case, the Inspector General found the allegations of bias were unsubstantiated.”
However, “the report also shows the wide swath of national security matters that Acting Secretary Shanahan is barred from, which strikes me as something the Senate needs to consider,” he added.