DOD Revolving Door:

Processes Have Improved but Post-DOD Employment Reporting Still Low

NSIAD-89-221: Published: Sep 13, 1989. Publicly Released: Sep 21, 1989.

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Pursuant to a congressional request, GAO reviewed the Department of Defense's (DOD) implementation and enforcement of disclosure laws requiring certain former DOD employees to report any subsequent employment with certain DOD contractors.

GAO found that: (1) about 6,600 former military officers and civilian employees holding industrial security clearances worked for defense contractors during fiscal years (FY) 1986 and 1987; (2) the disclosure laws exempted about 20 percent of those former mid- and high-level DOD personnel from reporting their defense-related employment, since they did not work with major defense contractors; (3) only 1,450 of the 4,900 nonexempt former employees reported their defense-related employment; (4) DOD could not determine the compliance rate of former employees who did not have security clearances; (5) DOD did not take all of the administrative enforcement actions available to it to enforce former employees' compliance with reporting requirements; (6) DOD reviewed the reports it received and certified them if it did not identify conflicts of interest; (7) most reports generally complied with reporting requirements, although former employees did not always honor DOD requests for additional information; and (8) DOD regulations required former employees to report whether they worked on major defense systems while at DOD and at the defense contractor, but DOD did not provide space on its reporting form for such information.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The agency is currently negotiating with the Department of Defense Inspector General (DOD/IG) to conduct investigations and impose fines where applicable. DOD/IG has not investigated any of the cases forwarded and has declined to accept any referrals.

    Recommendation: The Secretary of Defense should direct the Standards of Conduct Office to take more aggressive enforcement action to increase compliance with the reporting requirement. This should include: (1) developing a methodology for determining who is required to report, such as individuals who meet the reporting criteria but do not hold a security clearance; (2) following up to the extent deemed necessary for those who fail to report; and (3) as a means of demonstrating DOD commitment to enforcing the law, giving serious consideration to imposing fines against those who, after being directly informed of their obligation to report, still fail to do so.

    Agency Affected: Department of Defense

  2. Status: Closed - Not Implemented

    Comments: The agency considers the recommendation to be minor and changing a standard form requires tremendous effort. Also, the section of applicable law was suspended and may be repealed. The agency would only consider this recommendation after the uncertainty of the law is settled and then only if OGE issues final regulations on Standards of Conduct, which is unlikely. OGE regulations were not issued.

    Recommendation: The Secretary of Defense should direct the Standards of Conduct Office to: (1) modify the reporting form to provide space for individuals to report positively or negatively whether they worked on major defense systems while at DOD or at the defense contractor; (2) clarify the reporting instructions to specify that negative reporting is also required; and (3) begin enforcing the requirement that former employees provide this information on their reporting form.

    Agency Affected: Department of Defense


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