Posted on: Saturday, February 19, 2005

Former Boeing CFO gets four months

By Stephen J. Hedges
Chicago Tribune

ALEXANDRIA, Va. — The former chief financial officer of Boeing Co. was sentenced yesterday to four months in prison and fined $250,000 for violating a federal conflict-of-interest law by arranging a job at the company for a Pentagon official who had influence over the company's defense contracts.

"You are a person who had everything," U.S. District Judge Gerald Bruce Lee told 57-year-old Michael Sears, once believed to be in line to become chief executive of Chicago-based Boeing. "And in the blink of an eye, you jeopardized everything."

Sears told Lee: "I take full responsibility for the bad decision I made on the 17th of October" 2002, his first meeting with Air Force official Darleen Druyun to discuss a Boeing job. "I know what I did was wrong. I would like to apologize to the Air Force, to the Department of Defense and the citizens of this country."

The U.S. Attorney's office here disclosed that the Pentagon is reviewing all instances in which senior Defense Department officials left government service to take jobs with defense contractors during the past four years.

Authorities said the review was prompted by the circumstances surrounding Boeing's decision in late 2002 to hire Druyun, who had served as the Air Force's deputy assistant secretary for acquisition and management. Sears played an instrumental role in arranging the job for Druyun.

U.S. Attorney Paul McNulty said Sears also must perform 200 hours of community service.

McNulty said the investigation into dealings between the Air Force and Boeing is continuing.

In a statement yesterday, Doug Bain, Boeing's senior vice president and general counsel, said, "Today's action brings this matter one step closer to closure. The Boeing Co. has provided information every step of the way to support the government's ongoing review of Darleen Druyun-related procurements and to achieve our mutual goal to finally resolve this matter."

Sears pleaded guilty in November to negotiating a job at Boeing for Druyun, even though he knew that Druyun had not removed herself from Air Force discussions involving Boeing's business, as required by Defense Department rules. That business included a $23.5 billion proposal to lease 100 converted Boeing 767s to fly as Air Force refueling tankers.

The deal faltered after critics in Congress and watchdog groups questioned the exclusive arrangement with Boeing.

Druyun was sentenced in October to nine months in prison, a term she is now serving.