By Noah Shachtman and Spencer Ackerman March 7, 2011
When Regina Dugan left her family business to head up Pentagon bleeding-edge research agency Darpa, she signed a form pledging to have nothing to do with her former firm, the military contractor RedXDefense. That formally recused Dugan from any business with the company. But the document, provided by the agency, shows that she kept her stock in RedXDefense, even as it won a $400,000 Darpa contract.
Agency officials insist that Dugan abided by the terms of her recusal and had nothing to do with RedXDefense’s deal. But even if Dugan maintained a firewall between her government job and her old firm, open government groups say, her continued ownership of $15,000 or more in RedXDefense stock creates the potential for the appearance of a conflict of interest.
“She should have divested herself completely of stock in the company she founded, if only to avoid the appearance of impropriety,” says Nick Schwellenbach of the Project on Government Oversight. “Recusals are nice, but she should put her money where her mouth is: away from her old company.”
After Dugan left Darpa in 2000, she co-founded RedXDefense, a firm specializing in explosives detection, and led the firm until her 2009 appointment to lead the research agency. (Her father is now the company CEO, and her uncle sits on the RedXDefense advisory board.)
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http://www.wired.com/dangerroom/2011/03/darpa-chief-owns-darpa-contractor-stock/Cosy little racket she has going there.....