Ex-Homeland officials profit in private sector

Dozens work for companies that sell domestic security products

June 18, 2006|By ERIC LIPTON | ERIC LIPTON,THE NEW YORK TIMES

WASHINGTON -- Dozens of members of the Bush administration's domestic security team, assembled after the Sept. 11 attacks, are now collecting bigger paychecks in different roles: working on behalf of companies that sell domestic security products, many directly to the federal agencies the officials once helped run.

At least 90 officials from the Department of Homeland Security or the White House Office of Homeland Security - including the department's former secretary, Tom Ridge; the former deputy secretary, Adm. James M. Loy; and the former undersecretary, Asa Hutchinson - are executives, consultants or lobbyists for companies that collectively do billions of dollars' worth of domestic security business.

More than two-thirds of the Homeland Security Department's most senior executives in its first years have left. That raises questions for some former officials.

"People have a right to make a living," said Clark Kent Ervin, the former inspector general of the department, who now works at the Aspen Institute, a nonpartisan public policy research center. "But working virtually immediately for a company that is bidding for work in an area where you were just setting the policy - that is too close. It is almost incestuous."

Federal law prohibits senior executive branch officials from lobbying former government colleagues or subordinates for at least a year after leaving public service. But by exploiting loopholes in the law - including one provision drawn up by department executives to facilitate their entry into the business world - it is often easy for former officials to do that.

Michael J. Petrucelli, for example, who was once acting director of citizenship and immigration services, moved within months of leaving his post in July 2005 to a job in which he lobbied the Coast Guard, another unit of the department, to test a power-supply device made by his new employer, GridPoint.

Victor X. Cerda, within a few months of his 2005 departure as acting director of the agency that handles the detention of illegal immigrants, was hired by a company that is a top contractor for that agency. With Cerda's help, the company is seeking millions of dollars in new agency business.

In their new roles, former department officials often command salaries that dwarf their government paychecks. Carol A. DiBattiste, who made $155,000 in 2004 as deputy administrator at the Transportation Security Administration, earned more than $934,000 last year from ChoicePoint, a Homeland Security Department contractor she joined in April 2005, the month she left the agency.

Ridge, the former secretary, stands to profit handsomely now that Savi Technology, a maker of radio-frequency identification equipment that the department pushed while he was secretary, is being bought by Lockheed Martin. He was appointed to the Savi board three months after resigning from the department and has been compensated with an undisclosed number of stock options that Lockheed will presumably need to buy back. In the coming weeks, Ridge says, he plans to open his own domestic security and crisis management consulting firm.

The shift to the private sector is hardly without precedent in Washington, where generations of former administration officials have sought higher-paying jobs in industries they once regulated. But veteran Washington lobbyists and watchdog groups say the exodus of such a sizable share of an agency's senior management before the end of an administration has few modern parallels.

"It is almost like an initial public offering in the stock market," Scott Amey, general counsel at the Project on Government Oversight, based in Washington, said of the booming domestic security market. "Everyone wants a piece of it."

For two years, Hutchinson, a one-time U.S. senator and a current candidate for Arkansas governor, served as undersecretary for border and transportation security, supervising the 110,000 employees charged with guarding the nation's borders, ports and airports. His transition from public service to the for-profit world could serve as a primer for others.

Hutchinson began his negotiations to enter private industry months before he resigned. On March 2, 2005, the day after he officially left the department, he began work at Venable LLP, a law and lobbying firm that represents major domestic security contractors such as Lockheed Martin.

Federal law prohibits executive branch officials from negotiating for a job with companies they oversee. Hutchinson complied with this provision by signing a waiver in December 2004, vowing to be "disqualified from participating personally in any particular matter that would have a direct and predictable effect on Venable."

Benjamin R. Civiletti, the chairman of Venable, made clear why Hutchinson was attractive to the firm.

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