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Intel Firm Paid CIA Nominee Well As He Left for White House

Feb. 4, 2013 - 01:14PM   |   Last Updated: Feb. 4, 2013 - 05:29PM  |  
By ARAM ROSTON   |   Comments
President Barack Obama has nominated John Brennan (above) as CIA director. Financial disclosures related to Brennan's years in the private sector have raised new questions.
President Barack Obama has nominated John Brennan (above) as CIA director. Financial disclosures related to Brennan's years in the private sector have raised new questions. (Saul Loeb / AFP)
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John Brennan, the prospective head of the CIA, has spent most of his working life in government intelligence jobs, but he spent three years in the private sector just before joining Obama’s White House as counterterrorism adviser on Jan. 20, 2009. For that brief but profitable period, Brennan was the CEO of a little-known intelligence contractor called The Analysis Corporation, which does counterterrorism analysis for the U.S. government. (Since Brennan’s departure, TAC has been absorbed, through a merger, into a new firm called Sotera.)

A review of Brennan’s financial disclosure reports indicates that in 2009, TAC paid him a total of $169,923 in salary and bonus, which has not been previously reported. The financial disclosure reports, submitted as required of all White House employees, don’t say why he’d receive a bonus if he was leaving the company to join the government, or why he’d received such a large salary if he worked for the company for only 20 days that year.

In November 2008, two months before Brennan joined the Obama administration, TAC announced that the CEO was taking a “leave of absence” from the firm. That is, it is not clear that he was actually on the clock for the transition period before he received that $169,000.

“The payout is troubling,” said Scott Amey, general counsel of the Project on Government Oversight. “If Brennan’s disclosures are accurate, in early 2009 he joined the Obama administration, but yet he was paid nearly $170,000 by his former firm for about three weeks of work or as part of a deferred compensation package. Conflict-of-interest rules might allow this, but it’s another example of questionable dealings for someone passing through the revolving door.”

“Who knows if this will come up during his confirmation hearing,” Amey said, “but it should.”

In 2008, according to a separate financial disclosure report, Brennan received $763,000 from TAC for the year.

A White House spokesman said that the $169,923 received in 2009 was primarily a bonus owed to Brennan for work during the first ten months of 2008. That was the period before his leave of absence from the company. The spokesman said that Brennan had a yearly salary at TAC of $257,000 plus bonus, and that once he went on a leave of absence his employment agreement was modified. The spokesman also said that Brennan forfeited part of a retention bonus at TAC by joining the federal government when he did.

TAC, from the beginning, was integral to the government’s counterterrorism watchlist program. The company said it “designed and maintained” the State Department’s TIPOFF list, an early version of the list.

Brennan left the federal government after 25 years on Nov. 2, 2005. The following day, TAC issued a press release announcing that Brennan would step in as the company’s CEO that Nov. 7.

As Wired’s Danger Room has reported, Brennan stayed close to the CIA after joining TAC and maintained ties to Director George Tenet and other agency officials.

“When Tenet released his memoir the following year,” Wired reported, “former aide Brennan feted him for a book signing at The Analysis Corporation’s McLean, Virginia campus.”

Since Brennan joined the Obama administration, his former firm has flourished as well. While he was CEO, TAC was purchased by a large security contracting firm called Global Strategies Group, which had various major U.S. contracts. In 2011, most of the assets of Global Strategies Group were acquired by a hedge fund and the firm was renamed Sotera Defense.

Sotera declined to provide a statement in time for this report.

Although the White House did not comment prior to this story’s publication, White House spokesman Tommy Vietor offered these comments after the story was published:

• “1) There is nothing inappropriate about John getting a payout in 2009 of amounts owed from his prior employment. Indeed, severing financial ties with prior employers is what the onboarding ethics process seeks to accomplish and indeed was approved by appropriate ethics officials. The 2009 report on which this payment appears was certified by ethics officials at the White House and at the OGE.

• 2) It is misleading to suggest that this is some secret payment that no one knew about before. Quite the contrary, the payment is on John’s PUBLIC financial disclosure form for 2009, which was filed on May 10, 2010. The White House announces on its website when the reports are available and any member of the press or public is entitled to request a copy of the report. John’s reports have been requested by various news outlets in the past nearly 3 years. Our records indicate that this particular report has been requested at least 7 times.”

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This story was update to reflect comments received by C4ISR Journal from the White House after publication.

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