November 25, 2003
Yesterday, Boeing (NYSE: BA ) announced that it had fired CFO Mike Sears for his part in hiring former Air Force procurement official Darleen Druyun while she was still working for the government on matters involving Boeing. Druyun, who has worked as deputy general manager of Boeing's Missile Defense Systems business for the past year, was also let go.
Boeing said that an internal review found that both Sears and Druyun had attempted to cover up their misconduct, leading to their dismissal.
At the heart of the controversy is a $22.5 billion deal involving the lease and eventual purchase of 100 Boeing 767 airborne refueling tankers. In September, the government launched an investigation into whether Boeing received insider info on rival bidder Airbus' bid for the deal, which Druyun had helped negotiate on behalf of the government. Documents revealed that Druyun had communicated to Boeing that Airbus had submitted a lower bid.
Sen. John McCain (R-Ariz), who had criticized the approved Boeing plan as a bad deal, is still awaiting the findings of the government investigation.
This is just the latest in the company's troubles. Boeing is still smarting over $1 billion in rocket contracts the U.S. Air Force took back this summer, after determining that Boeing employees had stolen documents from Lockheed Martin (NYSE: LMT ) to gain the contracts in the first place.
You almost have to believe that this is part of a larger problem with Boeing's culture. If Boeing didn't appear the pillar of ethics back in July, this certainly hasn't helped. Perhaps the real surprise is that none of this has done much damage to Boeing's stock -- Boeing closed up three cents to $38.89 yesterday.
Is the worst over for Boeing? Or is there more to come? Take your thoughts to the Boeing discussion board! Only at Fool.com. Jeff Hwang can be reached at JHwang@fool.com.