Former Energy Department official wins huge pay raise after moving to firm with deep ties to DOE

Five months after Deputy Secretary of Energy Daniel Poneman resigned and left the department’s Forrestal Building in Washington, he started a new job eleven miles away as president of a troubled corporation that he had championed while serving in the department’s top ranks.

Over five-and-a-half years as the department’s chief operating officer, Poneman approved or advocated giving hundreds of millions of dollars in contracts and other assistance to the United States Enrichment Corporation (USEC) during public hearings and private discussions with lawmakers and White House officials, according to interviews with those present.

The company, which processes uranium and sells nuclear fuel under its current name of Centrus Energy, gave Poneman a roughly 700 percent pay raise when it hired him as its chief executive officer on March 5. It will pay him roughly $1.5 million in salary and bonuses this year and up to $2 million starting in 2016, according to the company’s reports to the Securities and Exchange Commission. His salary at the DOE was $178,700 a year.

It’s common for federal officials to move from government to industry, expanding their contacts and influence in the former and their salary in the latter. But Poneman’s passage from government overseer to a company he financed with public funds has drawn unusually harsh and bipartisan scrutiny from lawmakers and watchdog groups.

It has also brought new attention to the department’s controversial, ongoing efforts to bail out a private firm with highly paid executives, which passed through a 2014 bankruptcy and still experiences huge losses. USEC was once government-run, but it was bought by investors for $1.9 billion in 1998, and they’ve been the beneficiaries of the stream of federal aid that Poneman helped arrange.

In interviews, Poneman and other Centrus officials said there is nothing inappropriate about his new job and that the company did not solicit him for its top position until several weeks after he left the Energy Department. “This thing came quite unexpectedly,” Poneman said, after he had already arranged a fellowship at Harvard’s Kennedy School of Government. He says that he will follow ethics laws that restrict his future dealings with the Energy Department.

Related: Key findings about USEC

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Copyright 2014 The Center for Public Integrity. This story was published by The Center for Public Integrity, a nonprofit, nonpartisan investigative news organization in Washington, D.C.