Michael Sears' Testimony Could Widen DOD Probes
Boeing's former chief financial
officer, Mike Spears, pleaded guilty Monday to charges that he
deceived the government when he offered a job to Air Force
negotiator Darleen Druyun as she oversaw contract talks aimed at
replacing the military's aging tanker fleet.
Druyun is already behind bars, sentenced in October to nine
months for her part in the scandal. Sears, who's now free on bond,
faces up to five years in prison and a $250,000 fine.
Federal prosecutors used information from Druyun to press their
case against Sears (right), who was once considered a candidate for
the top job at Boeing. When she made a plea deal with them Druyun
admitted to prosecutors that she supplied Boeing proprietary
pricing information from Boeing's archrival Airbus and its parent
The scandal, one of several ethical issues Boeing has faced in
the past year, prompted CEO Harry Stonecipher to call for an
internal audit of the company's business practices. Led by former
US Senator Warren Rudman, the review found no other instances of
the sort of improper hiring that landed Druyun in the executive
suite. Boeing has created an office of internal governance to avoid
such scandals in the future.
Boeing Senior Vice President and
General Counsel Doug Bain issued the following statement today
after federal prosecutors released details in the case against
"Today’s action brings this matter one step closer to
closure. The Boeing Company will continue to provide any
information requested in the ongoing review of Druyun-related
procurements and to take appropriate action to finally resolve this
"We believe the Statement of Facts reinforces what we have said
before – that no Boeing executive other than Mr. Sears
engaged in any wrongdoing in connection with Ms. Druyun’s
hiring. Boeing officials believed that Mr. Sears and Ms. Druyun
were fully complying with all appropriate Boeing and DOD procedures
in his recruitment efforts.
"One year ago, Boeing dismissed Mr. Sears and Ms. Druyun (below)
because an internal investigation concluded they had violated
Boeing hiring policies and ethical standards. Boeing immediately
brought the matter to the attention of the appropriate authorities
and cooperated with them throughout the investigative process.
"In addition to dismissing Mr. Sears and Ms. Druyun last year,
the company commissioned an independent external review of its
hiring practices, which determined that Boeing had in place well
established policies and procedures. Nevertheless, the Company has
adopted recommendations from that review and strengthened its
policies in this area, including establishing an Office of Internal
Governance reporting directly to the CEO.
"Today, every employee of The Boeing Company – at every
level – understands that integrity and ethics are the
foundation of our business, and we have both the will and the
process to ensure accountability for any violation."