Ex-Boeing CFO pleads guilty in contract scandal

Monday, November 15th 2004, 11:00 am

By: News On 6

ALEXANDRIA, Virginia (AP) _ Boeing Co.'s former chief financial officer pleaded guilty Monday to illegally hiring a top Air Force procurement officer who has admitted she gave the company preferential treatment on a $23 billion (euro17.75 billion) tanker contract.

Michael Sears, 57, pleaded guilty to a single count of aiding and abetting illegal employment negotiations.

Sears faces up to five years in prison when he is sentenced on Jan. 21, but his lawyer, James Streicker, said that under federal sentencing guidelines Sears most likely faces, at worst, a prison term of zero to six months.

Sears admitted that he offered Darleen Druyun, 56, who was one of the Air Force's top contract officers, to a six-figure executive position at Boeing while she was reviewing whether Boeing should get a $23 billion (euro17.75 billion) contract to provide new refueling tankers to the Air Force.

Druyun, who was sentenced in October to nine months in prison, admitted that she provided an inflated price to Boeing on the contract as ``a parting gift'' and that she had helped Boeing obtain inflated deals on previous contracts, while at the same time she intervened to get her daughter a job at the company and later to keep her from being fired by Boeing for poor performance.

Court records indicate that the daughter served as an intermediary in the summer of 2002 for job negotiations, in which Druyun insisted she wanted a job offer along the lines of chief operating officer _ ``something that would blow her out of the water.'' The daughter also relayed that she would be interested in Boeing because of the company's ``honest values.''

The $23 billion tanker contract has since been nullified, and the Pentagon has asked Congress to investigate a wide range of contracts in which Druyun was involved.

Druyun at first had insisted that she had provided no substantive help to Boeing even as she violated the government's conflict-of-interest laws, but later admitted that she gave Boeing favorable terms after she took a lie-detector test that was a requirement of her plea bargain.