This is an interesting connection worth doing a bit more investigation into, as a lot of defense contracting corruption appears to be tied to the Pentagon and federal employees within the federal system who appear to have inappropriate relationships with defense contractors. GFS
Wednesday 30 December 2009
The military’s senior mentor programs are part of a high-level review ordered by Defense Secretary Robert Gates and the subject of a report in USA TODAY. Earlier in December, Gates asked Deputy Secretary William Lynn to review whether mentors are overpaid and whether their work is a conflict of interest.
USA TODAY reported that the Colorado-based firm the Durango Group has an advantage over other consulting firms that try to win Pentagon contracts. That’s because the newspaper reported that the company has become a hub for retired officers who also are paid well by the military for their advice, and it produces more senior military mentors than any other company does. “Of the 59 former officers who work for Durango, 15 also serve as mentors,” the newspaper stated.
The retired officers are paid as Durango staffers to help private companies win and run Pentagon contracts, and the retirees are paid as military mentors by the military to help run war games, giving them access to classified strategies and weapons systems.
Durango’s mixing mentoring and consulting work shows that some mentors’ private interests overlap tightly with their military advisory jobs. “The firms’ mentors move seamlessly between roles as paid advisers to the services and paid consultants to defense companies in the same subject areas,” USA TODAY reported.
Therefore, Durango and the mentors it employs draw multiple income sources; they get paid by the military for advice and by defense contractors who want consulting help. Although the type of overlap isn’t illegal, some analysts say it should be.
A Senate subcommittee led by Sen. Claire McCaskill (D-Missouri) is investigating the military mentor programs, and Sen. John McCain (R-Arizona) said retired generals should be prohibited from participating in war games that have a bearing on the financial interests of their defense clients.
Last month, USA TODAY reported that “the military’s senior mentor programs have grown significantly in recent years, with little scrutiny from Pentagon leadership and none from Congress.”
For example, the newspaper reported that in addition to pensions of up to $220,000 a year, retired generals and admirals get paid up to $1,600 a day to be mentors, and many are earning more consulting for defense firms.
“About 80 percent of the 158 mentors identified through public records had financial ties with defense firms, but they’re not required to disclose those ties to the military or the public,” USA TODAY reported. “Because they are retained as contractors, mentors aren’t subject to the conflict-of-interest provisions that would apply if they were brought in as temporary federal employees.”
Defense consultants are not required to register as lobbyists if they don’t spend more than 20 percent of their time talking to Congress or the executive branch political appointees covered by lobbying disclosure rules. As a result, their fees, clients and activities typically are not disclosed to the public.
Durango’s connections were mentioned as its most valuable attribute when the company was bought in 2007 by Galen Capital Corp., a private equity firm.
According to USA TODAY, these days “Durango says it consists of about 70 ‘senior associates,’ including 59 former senior defense officials.”