WASHINGTON — A Pentagon report released Thursday cleared Acting Defense Secretary Patrick Shanahan of preferential treatment of Boeing while he was deputy secretary of defense, meaning he is now likely to be nominated as defense secretary.
The report revealed that the Defense Department began investigating Shanahan after receiving a complaint that he had tried to force both the Marine Corps and the Air Force to buy fighter jets made by Boeing, his former employer.
According to the report, on Feb. 7 an attorney from the Senate Armed Services Committee forwarded an anonymous allegation that Shanahan "tried to force the Commandant of the Marine Corps, General Robert Neller, to buy Boeing F/A-18s, and threatened to cut other Air Forces programs unless the Air Force Chief of Staff, General David Goldfein, supported buying the F-15Xs."
The investigation looked into whether Shanahan, a Boeing employee for three decades, promoted his former employer and disparaged its competitors in violation of Pentagon ethics.
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One week later, on Feb. 14, the office of Sen. Elizabeth Warren, D-Mass., forwarded three additional allegations to the Pentagon's inspector general that Shanahan had pressured the military services to purchase Boeing aircraft. The investigation then became public knowledge.
The investigation officially began on March 15, said a Pentagon spokesperson.
The report says: "We did not substantiate any of the allegations. We determined that Mr. Shanahan fully complied with his ethics agreements and his ethical obligations regarding Boeing and its competitors."
The investigation had been a major hurdle preventing President Donald Trump from nominating Shanahan to the top Pentagon job, according to three administration and defense officials familiar with the decision.
Trump could now nominate Shanahan to the position as early as this week.
In a statement, Shanahan's spokesman, Lt. Col. Joe Buccino, said: "Secretary Shanahan has at all times complied with his Ethics Agreement, which screens Boeing matters to another DoD official and ensures no potential for a conflict of interest with Boeing on any matter. Secretary Shanahan remains focused on retooling the military for great power competition, executing the National Defense Strategy, and providing the highest quality care for our servicemembers and their Families."
Officials caution that no nomination is final until Trump announces it.
Shanahan is also expected to face a tough confirmation hearing, given opposition to his nomination that's been building for weeks on Capitol Hill. He has already clashed with Sen. Lindsey Graham, R-S.C., a Trump ally, over Syria policy.
Shanahan has served as acting secretary for nearly four months. He stepped into the role on Dec. 31 after Trump ousted James Mattis as secretary of defense earlier than Mattis had planned to exit.
Shanahan left Boeing in 2017 when Trump nominated him to be deputy secretary of defense, working alongside Mattis. Shanahan divested himself of his Boeing and defense industry stock before taking the oath and has said he has recused himself from all Boeing-related issues since taking the job.
Among the signs that Shanahan would get the nomination was his recent hiring of a spokesperson, Jonathan Hoffman. The spokesperson job had been difficult to fill while Shanahan remained in the job in an acting capacity, according to defense officials.
Courtney Kube is a correspondent covering national security and the military for the NBC News Investigative Unit.
Carol E. Lee
Carol E. Lee is an NBC News correspondent.
Kristen Welker is a White House correspondent for NBC News.