December 13, 2022

Senator Warren Questions DoD on Former Google CEO’s Conflicts of Interest on Defense Advisory Boards

Eric Schmidt’s “investment activities, and the lack of public disclosure, create the appearance that these boards are yet another tool for influence-peddling and profiteering at DoD”

Text of Letter (PDF)

Washington, D.C. — United States Senator Elizabeth Warren (D-Mass.) sent a letter to Defense Secretary Lloyd Austin raising a series of questions for the Department of Defense (DoD) regarding press reports that former Google chief executive officer Eric Schmidt used his positions on defense advisory boards to further his own financial interests. Under the Federal Advisory Committee Act (FACA) the Secretary of Defense is responsible for ensuring that defense advisory board members adhere to ethics standards, including following ethics laws that prohibit participating personally and substantially in matters relating to individuals’ financial interests.

“Mr. Schmidt’s investment activities, and the lack of public disclosure, create the appearance that these boards are yet another tool for influence-peddling and profiteering at DoD, raising concerns about the ethics of their members and the utility of their recommendations,” wrote Senator Warren.

Reports have revealed several instances where companies Mr. Schmidt has invested in received multimillion-dollar Department of Defense contracts and may have created a direct financial conflict of interest with his roles as chair of the Defense Innovation Board and of the National Security Commission on Artificial Intelligence (NSCAI). 

In late 2021, the NSCAI published a report recommending that the federal government “significantly increase spending on artificial intelligence” to reach $32 billion annually by 2026. In response to these suggestions, the Senate version of the National Defense Authorization Act provided an additional $75 million “for implementing the National Security Commission on Artificial Intelligence recommendations.” Mr. Schmidt stands to benefit from this increase as he and his business partners have invested more than $2 billion in companies focused on artificial intelligence.

“The public deserves to know that members of DoD’s advisory boards are providing the department with the best and most appropriate advice to support national security, and are not abusing their authority to advance their own financial interests,” concluded Senator Warren.

Senator Warren’s Anti-Corruption and Public Integrity Act would require all agencies to post federal advisory committee information, including ethics and recusal information for members. Senator Warren is requesting that Secretary Austin address her concerns over this potential conflict of interest and respond to her questions no later than January 17, 2023.

Senator Warren has long championed stronger ethics rules to prevent billionaires from exploiting the government for their own financial ends:

  • In May 2022, Senator Warren introduced the Department of Defense Ethics and Anti-Corruption Act, which would enforce limits to the influence of contractors on the military, restrict foreign influence on retired senior military officers, and assert greater transparency over contractors and their interaction with the DoD.
  • In March 2021, Senator Warren sent a letter to Secretary of Defense Lloyd Austin praising his decision to suspend dozens of Defense Department advisory boards and relieve hundreds of appointees to these boards pending a “zero-based review.” In the letter, Senator Warren also called for improvements as the Department of Defense (DoD) considers candidates for repopulating the boards that survive DoD's review.
  • Senator Warren has also fought to preserve existing ethics laws, including defeating a provision from DoD and Senator Inhofe in the fiscal year 2021 National Defense Authorization Act to weaken Section 1045. 
  • In December 2020, Senator Warren and Congresswoman Pramila Jayapal (D-Wash.) reintroduced the Anti-Corruption & Public Integrity Act, bicameral legislation to fundamentally change the way Washington does business and includes provisions that would strengthen ethics laws and disclosure for federal advisory committees.

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