Top Pentagon officials linked to firm that sold U.S. faulty parts

May 25, 1994|By Newsday

WASHINGTON -- Four federal agencies are examining allegations that the Air Force was sold useless fighter cockpit displays by a California defense contractor whose board members at the time included William Perry, now secretary of BTC defense, and two other top Pentagon officials.

Under scrutiny is a 1987-91 contract between the Air Force and Scientific Applications International Corp., based in San Diego. During those four years, its high-powered board of directors included Mr. Perry; John Deutch, now the deputy secretary of defense, and Anita Jones, the new director of defense research and engineering.

After inquiries by Newsday, the three Clinton administration officials recused themselves from control over the Pentagon portion of the SAIC probe. The company paid a total of almost $900,000 in severance payments to Messrs. Perry and Deutch and Ms. Jones when they left the company to join the Pentagon in 1993.

The investigation involves Air Force payment of $9.2 million, primarily for F-15 fighter cockpit displays that SAIC made partially from tiny Japanese television screens that cost only $650 each.

An estimated 20 cockpit indicators that were supposed to show whether the plane was climbing or diving were made from color liquid crystal displays, or LCDs. None of the 20 cockpit LCDs ever worked properly.

While SAIC charges to the Air Force are one facet of the investigation, court records and subsequent depositions obtained by federal officials indicated that the investigation may hinge on SAIC promises that the cockpit displays could become operable if the Air Force paid an additional $320,000 for work on the project in 1991. Former SAIC employees contend the company knew at the time that the displays could not be repaired, federal investigators said.

The Justice Department, two Pentagon investigative agencies and the U.S. attorney's office in San Diego have seized two truckloads of documents relating to SAIC executives and board members. SAIC President Lorenz Kull denied allegations of fraud made by company whistle blowers.

Messrs. Perry, Deutch and Ms. Jones refused repeated requests to be interviewed about their possible involvement with the contract. But in a Pentagon statement to Newsday issued in their behalf, the three recused themselves from the SAIC investigation.

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