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Friday, September 24, 2004

Rummy Takes A Cut


Rumsfeld Sold Stakes in Pentagon Contractors

Wed Sep 22, 4:09 PM ET

By Jim Wolf

WASHINGTON (Reuters) - Defense Secretary Donald Rumsfeld sold stakes this summer in at least five companies after they were identified as doing business with the Pentagon, according to his latest financial disclosure form, made available on Wednesday.

Sold were all his shares in Millennium Chemicals Inc., St Paul Companies Inc., Sonoco Products Co., VF Corp. and Zebra Technologies Corp., according to an aide's handwritten note on the disclosure report.

The note, dated June 28, said the companies had been "identified as DoD defense contractors." The Pentagon did not immediately respond to a query about the threshold for such identification, nor about the reasoning behind the sale.

The 20-page form, released by the Office on Government Ethics in response to a request from Reuters, showed Rumsfeld's assets, liabilities and transactions for the year ended Dec. 31, 2003.

Described in ranges rather than exact amounts, his largest holdings included a trust in his name valued at $25 million to $50 million, farm land in New Mexico valued in the millions and a stake in Gilead Sciences Inc. worth $5 million to $25 million.

Rumsfeld served as chairman of Gilead Sciences, a Foster City, California, biotechnology company, before being sworn in as President Bush's defense secretary on Jan. 20, 2001.

As of July 27, Rumsfeld's designees were "in discussions" about divesting his shares in Community Health Systems Inc., which also was identified as a Pentagon contractor, according to the Pentagon's Standards of Conduct Office, which reviewed Rumsfeld's report for any perceived conflicts of interest. Community Health Systems was held via a venture called FLC Partnership.

Rumsfeld appeared to be under no legal requirement to sell the shares of any of the companies identified as Pentagon contractors, according to Alex Knott of the Center for Public Integrity, a Washington-based government watchdog.

"It appears as though Secretary Rumsfeld wanted to hold himself to a higher ethical standard when it comes to public perceptions," he said.

The form showed Rumsfeld accepted no gifts, reimbursements or travel expenses big enough to meet the government's modest thresholds for reporting. Among these are a requirement to report gifts from one source totaling more than $260.

(Additional reporting by Andrea Shalal-Esa)