WASHINGTON - US Defense Secretary Leon Panetta has decided to demote William Ward, former chief of US Africa Command, for acts of misconduct related to misuse of government funds, the Pentagon announced Tuesday.

Ward was stripped of a star to retire as a three-star Lieutenant General, while the Army seeks to recoup from him roughly $82,000 in expenses "stemming from Gen. Ward's misconduct in travel, misuse of military aircraft, misuse of staff and the receipt of reimbursements to which he was not entitled," Pentagon spokesman George Little said in a statement.

Little said that the Defense Department's Inspector General issued a report of investigation in June 2012, which substantiated Ward's acts of misconduct during his tenure as commander of the US Africa Command from 2007 to 2011.

In a Pentagon report, Ward was found to have spent $129,000 on an 11-day trip with an entourage of 13 military and civilian personnel.

"Secretary Panetta insists that leaders within the Department of Defense exemplify both professional excellence and sound judgment ... The secretary is committed to ensuring that any improprieties or misconduct by senior officers are dealt with swiftly and appropriately," the statement added.

The demotion was announced amid an unfolding sex scandal involving David Petraeus, a retired four-star general who resigned last week as Central Intelligence Agency (CIA) director, after he was found to have an extramarital affair with his female biographer, Paula Broadwell.

Earlier Tuesday, Panetta issued a written statement announcing that John Allen, head of the US forces in Afghanistan, is also being investigated for alleged "inappropriate communications" with Jill Kelley, who led to the investigation of Petraeus by reporting receiving threatening emails from Broadwell.

Kelley was an unpaid social liaison at MacDill Air Force Base, Florida, which is headquarters to the US Central Command.

Due to the pending investigation, Allen's nomination to the next commander of US European Command as well as the NATO supreme allied commander in Europe has been put on hold, and he would not attend a confirmation hearing at the Senate Armed Services Committee Thursday.