Pentagon Official Quits During Probe of Her Conduct

A top Pentagon procurement official has quit while being investigated on charges that she solicited business from several defense contractors for a private consulting firm she had planned to establish, it was announced Monday.

At the same time, the inspector general’s office of the Defense Department exonerated the official, Mary Ann Gilleece, of any criminal wrongdoing in her letters and calls to contractors last May and June to inform them of her plans to leave her government job and set up the consulting agency.

But the report, prepared before her resignation, said that Gilleece had violated the Pentagon’s internal code of conduct and recommended that she be removed from any responsibility for Pentagon purchases. It concluded that she had “so compromised her ability to perform her rule-making and policy-setting role that she can no longer effectively serve the department in such a position.”

‘Appearance of Impropriety’

A Pentagon spokesman said Monday: “She didn’t break any law but the appearance of impropriety and compromising her job was there. Sometimes that’s worse than the real thing.”

The spokesman said that Gilleece, until recently the top official overseeing Pentagon purchasing rules, refused to talk to reporters.

In a brief written statement, the Pentagon said that Gilleece quit last Tuesday, three days before the inspector general’s report was completed. The statement contended that she resigned because her job was scheduled for abolition under a planned management revision and not because of the impending release of the report on her conduct.

In addition to being investigated by the inspector general, Gilleece has been under fire from critics in Congress because of her financial ties to Frank Bane, a senior executive of TRW Inc., a major defense contractor. The pair have a financial interest in the suburban Washington home where Gilleece lives.

Deputy’s Role Cited

According to the Pentagon report, Gilleece and her top deputy, Navy Capt. Carl M. Meyer, began last spring to develop plans to quit the department and establish a consulting firm. She contacted 25 major defense contractors and two law firms through either phone calls or letters, informing them of her plans and in some cases enclosing a proposed contract for her services, it said.

In addition, Gilleece’s Pentagon secretary, who also planned to join the consulting firm, used a government word processor to type the letters, some of which asked prospective clients to contact Gilleece at her Pentagon phone number, the report said.

Gilleece defended her conduct to Pentagon investigators, saying that she consulted a department ethics specialist and moved to disqualify herself from responsibility for activities involving firms to which she had sent letters.

Furthermore, she contended, she had not actually solicited the business of the contractors she contacted and was only testing whether her consulting proposal would be marketable.

But representatives of several of the firms told Pentagon investigators that they believed Gilleece wanted their business.

“Although Ms. Gilleece testified that her letters were not intended to be solicitations for business, they gave the appearance that they were and were perceived as such by many of the recipients,” the report found.