98 Percent of Former Military Officers Drop Out of Pentagon Program after Financial Disclosure

Since Defense Secretary Robert Gates ordered the Pentagon to require "senior mentors" to file public financial disclosure documents, 98 percent of the retired senior officers from the Navy, Marines and three special combatant commands have left the program, according to a Department of Defense Inspector General (DoD IG) report released on October 31.

Percentage of senior mentors who have left the Pentagon's senior mentors program following increased financial disclosure requirements.

Photo by Flickr user Leo Reynolds

The controversial "senior mentors" program refers to the Pentagon's practice of hiring retired military officers, one to four stars in rank, as part-time government advisors. According to USA Today, in exchange for offering advice to former colleagues, these mentors made as much as $330 an hour—more than triple what they made as active officers.

On top of that, USA Todayrevealed that of 158 identified senior mentors, 80 percent had financial ties to defense contractors—and 29 were full-time executives of defense companies. As POGO’s former national security investigator Mandy Smithberger pointed out, this practice showed that “the revolving door between the Pentagon and the defense industry is alive and well…and raises many ethical questions that merit additional investigation by Congress and the Inspector General.”

After the Senate Armed Services Committee exerted pressure, the Pentagon ordered an overhaul of the program in April 2010. The resulting memorandum [which was revised again in November, 2010] included subjecting mentors to federal conflict of interest laws, such as preventing mentors from divulging non-public information to defense contractors, or taking action that has “a direct and predictable” effect on their private interests. It also required all members of the program to disclose their employers, earnings and stocks.

The resulting Inspector General audit aimed to determine whether DoD implemented and complied with the memorandum. It determined that of the 194 reported senior mentors in the Navy, Marine Corps and the U.S. Special Operations, Joint Forces and Strategic commands in fiscal year 2010, 11 converted to the title of “highly qualified expert” (HQE) and the rest are no longer working in the senior mentor program.

Of the 11 that converted to HQEs, 7 have since resigned. The DoD IG says that these seven “were not required to file a financial disclosure report because they subsequently resigned from their positions before the filing deadline.”

Also, senior DoD officials told the IG that some senior mentors did not convert to HQEs because the new policy might have limited their pay. Specifically, according to the report, an HQE may only be paid up to a specific authorized amount, which in 2010 was $179,700 per year. As the report notes, this amount is equivalent to a salary authorized for 3-and 4-star flag and general officers on active duty, which is the most they could have made before moving into the private sector.

The IG report also cites DoD officials who said some of the mentors dropped out because they did not want their “employment opportunities in the private sector” limited. The Secretary of Defense had issued a memo that would have prevented former officers who worked as mentors 60 days or more a year from representing clients before the DoD for a year. Remember how we earlier mentioned that USA Today found that many of them were working for defense contractors?

It appears that, for at least some of the former military officers who dropped out of the mentors program, it’s clear which choice they made when it came to patriotism or money.