- On June 14, Ms. Gilleece signs a disqualification form. This disqualification did not cover her policy making responsibilities that affect all defense contractors, their DOD contracts and how they get paid.

- A June 25, Wall Street Journal article features Ms. Gilleece. It states that she is a "staunch defender of the defense industry," and that she believes the system is "99 and 44/100 percent pure." It went on to report that one Republican Senator accused Ms. Gilleece of, "loving the almost incestuous relationship between industry and the Pentagon."

On June 25, and June 26 or 27, Ms. Gilleece meets with Dr. Wade, Mr. Ream and DOD's General Counsel Chapman Cox. Dr. Wade suggests removing Ms. Gilleece from her job and making her a Special Assistant. Instead, she states that she will terminate her plans to start a consulting firm for defense contractors.

- On July 3, General Counsel Cox requests an IG

investigation.

- On July 10, Ms. Gilleece participates in a meeting concerning the Federal Acquisition Regulation, which serves as the basis for all government contracting policy and practices, to discuss certification and field audits.

On July 24, Ms. Gilleece testifies before a Senate subcommittee opposing work measurement standards.

- Also on July 24, Ms. Gilleece writes a memo to Dr. Wade. advising him she had notified the defense firms she had contacted about the termination of her plans.

- On August 16, the IG completes its investigation, concluding that Ms. Gilleece had violated DOD's standards of conduct and referring the case to the Department of Justice. The IG found that "The actions taken by Ms. Gilleece, and the ensuing publicity, have so compromised her ability to perform her rule making and policy setting role that she can no longer serve the Department in such a position."

On August 19, Ms. Gilleece resigns from DOD.

BIOGRAPHICAL DATA

Mary Ann Gilleece

Mary Ann Gilleece served as the Deputy Under Secretary of Defense for Research and Engineering (Acquisition Management) from April 1983 to August 1985. As Deputy Under Secretary, she served as the principal advisor to the Under Secretary of Defense for Research and Engineering in all matters concerning management and policy for the Department of Defense acquisition process. She directed the effort to make procurement system improvements in accordance with Executive Order 12352 of March 17, 1982 on Federal Procurement Reforms and was the DoD member of the OMB Executive Committee on Procurement Reforms. Another key area of responsibility was the formulation and execution of DoD international acquisition objectives, policies, and programs for cooperation in.. research, development, production, and procurement with U.S. Allies. Other major activities of her office included programs to improve the productivity of defense contractors and the production capabilities of the U.S. industrial base.

Prior to her appointment, Ms. Gilleece was appointed an Assistant Attorney General for the Commonwealth of Massachusetts, practiced law privately for a number of years, and served for 6 years as Counsel to the U.S. House of Representatives, Committee on Armed Services. In that position she was responsible for Committee functions relating to Federal contracting legislation and government procurement methods.

She graduated from the University of Connecticut in 1962 and attended Suffolk University Law School in Boston where she received a Juris Doctor degree in 1972 and in that year became a member of the Massachusetts Bar. In 1982, she received a Master of Laws degree in Government Procurement Law from the George Washington University. Ms. Gilleece is a member of the Federal Bar Assocation and American Bar Association Public Contracts Sections. She is on the Board of Advisors of the National Contract Management Association.

BIOGRAPHICAL DATA

C. M. Mayer

C. M. Mayer has an extensive background in defense contracting. He has held a broad range of key positions in both developing and implementing contracting policy for major systems. He served as contracting officer for a number of major naval construction and overhaul programs, including the FFG-7 guided missile frigate, DD-963, and Trident submarine programs. He was responsible for all business and contractual aspects of these programs and dealt with a wide variety of difficult issues, including claim settlement, indemnification, and complex contract financing. In the DD-963 class destroyer construction and submarine overhaul programs, he acquired extensive field contract administration experience, particularly in such specialized areas as cost accounting standards, cost allowability. and cost/schedule control systems. As the chief contract finance advisor within the Naval Sea Systems Command, he had many years of experience in resolving audit issues in connection with contract placement and administration. Most recently, during the two years he served as executive assistant to the Deputy Under Secretary of Defense (Acquisition Management), he participated in the formulation and implementation of acquisition policy encompassing the entire Department of Defense.

Mr. Mayer completed twenty years active duty in the U.S. Navy, serving as a Captain in the Supply Corps at the time of his retirement. He has a Bachelor of Science degree from the University of Notre Dame and his MBA from the University of Virginia, where he is a member of the adjunct faculty, lecturing on procurement. He has also taught accounting and business finance. He is a licensed CPA in the District of Columbia and is a member of the American Institute of CPAs and the DC Institute of CPAs.

6/14/85

6/18/85

6/28/85

SEQUENCE OF MS. GILLEECE'S DISQUALIFICATION ACTIONS

6/26 or 6/27

Ms. Gilleece's first disqualification from 14
contractors for which she initially contacted.
(11 contractors plus two law firms are yet to
be contacted.)

The first disqualification action came 6 weeks after she began contacting contractors.

Ms. Gilleece signs additional disqualification for 10 additional firms she contacted.

Ms. Gilleece disqualifies herself from the remaining contractor. No evidence that she disqualified herself from law firms.

Ms. Gilleece informs Dr. Wade and Messrs. Cox and Ream that she would notify the firms that she contacted that she plans to terminate her consulting venture. DOD officials wanted her to notify contractors by letters, she preferred phone calls. We don't know if notification of termination plans actually occurred.

NOTE: Ms. Gilleece had contact with 31 firms -- 29 defense contractors and two law firms. Of the 29 contractors, four contacted her. No evidence that Ms. Gilleece recused herself from contractors who

contacted her.

By reason of a financial interest in the companies listed below, until further notice, I am disqualified from taking any action that might have an impact upon that company.

In the unlikely event that any matter arises that may have a direct or predictable impact upon the interest of that company, I will immediately make necessary arrangements to insure that I am not involved. In addition, I will advise my immediate subordinates of this disqualification.