The director of the Pentagon's premiere research arm has hundreds of thousands of dollars invested in one of her agency's contractors -- and an outstanding IOU with the firm for hundreds of thousands more. But according to her deputy, it's no cause for concern. In fact, the financial ties are the price Darpa pays for excellence.
As Danger Room has been reporting, Darpa Director Regina Dugan is owed $250,000 by her family firm, the explosives-detection company RedXDefense, which has won $1.7 million worth of contracts with the agency since Dugan took over July 2009. Darpa says the relationship is on the up and up because Dugan has recused herself from any business dealings with RedXDefense.
That doesn't satisfy government ethics watchdogs, who wonder how Darpa program managers can reasonably be expected to reject the boss' old company.
Dugan's deputy, Kaigham "Ken" Gabriel, provides an unlikely exculpation for the conflict of interest: A ton of people at Darpa have one. "Honestly, this is something that is prevalsent," Gabriel (pictured) tells the Los Angeles Times. "We just know how to deal with it. It's not that big of a deal, frankly."
By that, Gabriel means Darpa needs to attract top-flight technical talent from academia, government and industry. That often means turning to people tied to the firms or research groups who seek Darpa funding. Once they take themselves out of the loop on any business decisions involving their old employers, it's all kosher.
Gabriel has a point: Many of Darpa's chosen research fields -- pathogen detection, biomorphic robotics, brain-controlled prosthetics -- are relatively small and tight-knit. Any Darpa program manager worth his or her salt is bound to run into buddies and former co-workers while on the job.
But there was a time, not long ago, when a Darpa officials' interactions with these one-time colleagues were tightly proscribed. For instance, a program manager with ties to a university was barred from giving a contract to anyone at the old school -- even if the two were in entirely different departments or different campuses, with no possibility of a direct financial relationship.
If there was even a slight chance that a company might bid on a Darpa research project, that firm and and that program manager were disqualified to work on that particular research effort.
The bright ethical guidelines had unintended consequences, however. If a company allowed an employee to take a sabbatical to join Darpa, the firm was essentially blocking itself from millions of dollars in agency research projects.
So under Dugan and Gabriel, the rules changed.
Program managers with potential ethical conflicts could designate someone else at Darpa to make decisions about their former company or university. "More realistic conflict of interest rules have been applied to people coming to work at Darpa," Gabriel told a conference last year.
Of course, there's a difference between a program manager's connections to a prospective contractor and the director's ties. Even if the Darpa chief recuses herself from a particular business deal, she can't excise the influence she wields over the entire organization.
The director's background -- and continued ties to a given contractor -- can make a manager think twice before turning down a bid. That's especially true when the company in question is run by the director's dad, as RedXDefense is.
"If I was a Darpa employee, I wouldn't want to be in a position of depriving my boss' family members of a large contract," says Nick Schwellenbach, director of investigations at the Project on Government Oversight.
Darpa points to nearly $5 million in contract awards that RedXDefense lost during Dugan's tenure as evidence that the company doesn't receive favorable treatment. But perhaps the systemic issue with the director's conflict of interest is the more glaring concern.
The Times notes that no law requires the Darpa chief to relinquish financial stakes in defense companies before taking office, unlike other Senate-confirmed Pentagon positions. Until that law changes, Dugan might not be the last Darpa chief to pose a risk of making money off contracts her agency awards.
Photo: Darpa
See Also:
