Three people with knowledge of the matter told the US media outlet in a story published Monday that Carter is willing to overrule an earlier Army recommendation that Petraeus not have his rank reduced.
Though the revered former commander is now retired, his retroactive demotion to a three-star general could cost him hundreds of thousands of dollars over the course of his retirement, as his pension payments would be knocked down to the last rank at which he satisfactorily served, the Daily Beast reported.
Prior to his downfall, he had been regularly praised for his efforts during the "surge" of troops in Iraq and credited for helping salvage the troubled war effort in that country.
Pentagon press secretary Peter Cook told the Daily Beast that Carter was still reviewing the Army's recommendation not to demote Petraeus.
"Once the secretary has an opportunity to consider this information, he will make his decision about next steps, if any, in this matter," Cook said.