Pentagon Issues Ethics Memo Before Gutting Conflict-of-Interest Rules

By Spencer Ackerman January 4, 2011

Savor the irony: within days of the Pentagon’s second-in-command issuing a memo on ethics guidelines for its top leaders, the Defense Department loosened its restrictions on conflicts of interest for its contractors.

On December 29, the Department made it easier to brush under the rug conflicts between it and its contractors, all in the name of competition. Big defense companies can sometimes win defense cash to, say, build a weapon, while a subsidiary gets cash to test it out. Since Company X is in a position to stretch out the job during tests by bringing the weapon back to the drawing board, the Pentagon can call in its contract management officers to review so-called “organizational conflicts of interest” and potentially split up the contract.

Scott Amey of the Project on Government Oversight, which found the rule change, said the new language “reads like a contracting association lobbying letter.” And because it doesn’t define any penalties for violators, the department won’t be sufficiently able to “hold contractors accountable for failing to disclose an actual or apparent” conflict of interest.

Now for the bittersweet part. Just days before the department issued the change, William Lynn, the deputy secretary of defense, issued a memo to senior Pentagon leaders on “Ethics, Integrity and Accountability.” It reminded the leadership to “avoid any action that gives rise to public concern about the integrity of business procedures and decisions.” But Lynn didn’t beef up any ethics rules or clarify any guidance about what to do if potential conflicts emerge.

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http://www.wired.com/dangerroom/2011/01/pentagon-issues-ethics-memo-before-gutting-conflict-of-interest-rules/