The U.S. Defence Department’s Inspector General, Glenn Fine, on Thursday concluded that acting Defence Secretary Patrick Shanahan did not seek preferential treatment of Boeing Co, his former employer, while at the Pentagon.
The decision potentially opens the door for U.S. President Donald Trump to formally nominate Shanahan to be defence secretary.
The inspector general started the investigation in March after a watchdog group filed a complaint alleging Mr Shanahan promoted aerospace firm Boeing in meetings and disparaged competitors.
Shanahan, 56, who spent over 30 years at Boeing, is the longest serving acting defence secretary ever.
He took over at the Pentagon in an acting capacity on January 1, after Jim Mattis resigned amid policy differences with Trump.
The inspector general’s report, which was published on Thursday, said none of the allegations against Mr Shanahan were substantiated.
“We determined that Mr Shanahan fully complied with his ethics agreements and his ethical obligations regarding Boeing and its competitors,” it said.
The report said investigators had interviewed Mr Shanahan and 33 other witnesses, including Mattis and Vice Chairman of the Joint Chiefs of Staff General Paul Selva, and reviewed over 5,600 unclassified documents and about 1,700 pages of classified documents.
The report said it found that while Mr Shanahan did refer to his time at Boeing, witnesses assumed that he was trying to improve management of Pentagon programmes.
One of the allegations was that Mr Shanahan criticised the F-35 aircraft made by Lockheed Martin and “repeatedly dumped’’ on the jet in meetings.
However, the report said his comments about the F-35 programmes were consistent with comments about problems cited by other senior Pentagon officials.
The investigation was in part based on a complaint filed by the Citizens for Responsibility and Ethics in Washington, a watchdog group, which said Mr Shanahan had appeared to violate the ethical rules by promoting Boeing while at the Pentagon.
Officials close to Mr Shanahan have said they believed the investigation was one of the main reasons he has not been nominated yet for the job formally.
There is growing speculation that after being cleared by the inspector general, Mr Trump could nominate Shanahan soon.
If nominated, Mr Shanahan would have to be confirmed by the Senate.