Category Archives: conflict of interest laws

“McCarthy Proposes Gutting Office of Congressional Ethics in Bid for Speaker”


House Minority Leader Kevin McCarthy spent the first two days of the new year trying to shore up GOP support for his bid to be Speaker by releasing a series of proposals aimed at winning over hard-right detractors who stand to torpedo his ascension.

The part of his proposed changes to House rules that drew the most attention was allowing just five House members to call for a vote at any time on ousting the Speaker; that would render McCarthy beholden to the most extreme members of his caucus, should he get on their wrong side. But buried in the text was another provision that could be highly consequential for the new Congress being sworn in on Tuesday: language that would effectively gut the Office of Congressional Ethics (OCE), as the independent panel faces pressure to investigate lawmakers who participated in the Jan. 6 attack on the Capitol.

Most significantly, McCarthy’s proposal would require OCE to hire its staff for the 118th Congress within 30 days of the resolution’s adoption, a requirement that sources familiar with the process tell TIME would make it exceedingly difficult for the office to have the resources it needs to conduct its investigations, given how long it takes to hire candidates for roles in the federal government. The proposal would also block OCE from hiring new employees over the next two years if someone leaves their position, sources say.

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“While advising Trump on judges, Conway sold her business to a firm with ties to judicial activist Leonard Leo”


Longtime judicial activist Leonard Leo appears to have helped facilitate the sale of former White House senior adviser Kellyanne Conway’s polling company in 2017 — as she was playing a key role in advocating for Leo’s handpicked list of Supreme Court candidates, according to previously unreported financial documents reviewed by government ethics and finance experts.

The transaction came at a critical moment for Conway — shortly after her ownership of The Polling Company had come under scrutiny from a congressional oversight committee for potential “conflicts of interest,” likely creating pressure to unload it even though its value was unclear because she was its biggest asset and committed to her White House job.

It appearsLeo, via one of his dark money groups, helped finance the transaction between the firm, Creative Response Concepts Inc., and Conway — worth between $1 million and $5 million, according to experts citing the timing of the transactions filed through the same attorney and bank. At the time, CRC was also bringing in millions of dollars from dark money groups to promote Leo’s picks….

If Leohelped facilitate the transaction, it could violate ethics laws designed to prevent executive branch employees from obtaining benefits from people with whom they interact in their official capacities, said Bruce Freed, president of the nonpartisan Center for Political Accountability, which tracks corporate spending in politics. Federal ethics laws prohibit executive branch employees from using their positions for private personal gain and from accepting gifts.

“It really shows Kellyanne as a vehicle for Leo, the leading role Leo has played and how Trump became his instrument,” said Freed, after reviewing the documents.

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In Ohio and North Carolina, Children of Political Leaders Sit on State Supreme Court Deciding on Legality of Latest Redistricting Plans Challenged as Gerrymanders

In North Carolina, Justice Phil Berger, Jr. will decide himself whether he can rule on lawsuits against his dad, a leading Republican state senator.

In Ohio, Justice Pat DeWine “has chosen not to recuse himself. DeWine says he’ll hear arguments in a trio of lawsuits against the Ohio Redistricting Commission. His father, Gov. Mike DeWine, is a member.”

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“Trump Officials Illegally Campaigned While in Office, Watchdog Finds”


Thirteen of President Donald J. Trump’s most senior aides — including his son-in-law and his chief of staff — campaigned illegally for Mr. Trump’s re-election in violation of a law designed to prevent federal employees from abusing the power of their offices on behalf of candidates, a government watchdog agency said Tuesday.

Henry Kerner, who heads the Office of Special Counsel, made the assertion in a withering report that followed a nearly yearlong investigation into “myriad” violations of the law, known as the Hatch Act.

“Senior Trump administration officials chose to use their official authority not for the legitimate functions of the government, but to promote the re-election of President Trump in violation of the law,” the report concluded.

Investigators in Mr. Kerner’s office said Trump administration officials purposely violated the law prohibiting political activity during the final few weeks of the administration, when they knew that the Office of Special Counsel would not have time to investigate and issue findings before Election Day….

iolations of the Hatch Act are not uncommon for any presidential administration. In October, Jen Psaki, the White House press secretary, apologized after an outside group accused her of violating the law by commenting in the White House press room on the pending governor’s race in Virginia.

But the Kerner report describes something more rare: a concerted, willful effort to violate the law by the most senior officials in the White House. The Washington Post disclosed the report’s release earlier on Tuesday.

The people accused of breaking the law are a who’s who of Trump officials: Secretary of Energy Dan Brouillette; Kellyanne Conway, counselor; Alyssa Farah, White House communications director; David Friedman, ambassador to Israel; Jared Kushner, senior adviser; Kayleigh McEnany, press secretary; Mark Meadows, chief of staff; Stephen Miller, senior adviser; Brian Morgenstern, deputy press secretary; Robert C. O’Brien, national security adviser; Marc Short, chief of staff to the vice president; Secretary of State Mike Pompeo; and Acting Secretary of Homeland Security Chad Wolf.

The report said that Mr. Pompeo and Mr. Wolf violated the law through their actions during the Republican National Convention, which took place at the White House because of the pandemic.

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“California politicians raising money for charity face new rules from ethics panel”

Cal Matters:

After more than 18 months of deliberation, California’s political ethics regulators voted today to approve new rules when elected officials raise money for charities that they or their family control.

More public disclosure of their ties to the group getting the payments? Yes.

Limits on money from interest groups that lobby the officials? Not at all.     

The new rules fall far short of what government watchdogs say is necessary to rein in the growing trend of charitable donations serving as a conduit for interest groups that seek to influence politicians. Stronger rules would need legislative approval, and lawmakers made clear they’re not interested.     

The new rules on so-called “behested payments” were crafted by the Fair Political Practices Commission following a CalMatters investigation that showed how politicians increasingly use charitable organizations to raise and spend money outside the limits of the state’s strict campaign finance laws. 

The CalMatters report revealed that a dozen nonprofits run by state lawmakers and their staffs reported raising nearly $3 million in 2019 from interest groups that lobby the Legislature; that a nonprofit tied to the Legislature’s technology caucus was keeping its donations secret; and that a lawmaker — now Attorney General Rob Bonta — routinely asked interest groups to donate to his personal foundation as well as to nonprofits that employed his wife Mia Bonta, who is now an assemblymember.

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California: “Facebook, Google, other corporate giants flooded Newsom with record $226 million in charity donations in 2020”

LA Times:

Facebook, Google and Blue Shield of California are among the companies that contributed $226 million to government causes on Gov. Gavin Newsom’s behalf last year, an unprecedented level of spending that is raising alarms about the influence large corporations are amassing in Sacramento.

State records reviewed by The Times show that so-called “behested payments” surged in 2020 compared with the year prior, when companies gifted $12.1 million on Newsom’s behalf. The governor’s haul last year during the COVID-19 pandemic was six times as much as that reported by former Gov. Jerry Brown during his final eight years in office combined.

With no limit on how much money can be donated by organizations or individuals at the behest of the governor, millions of dollars flowed in to prop up public services during the pandemic and fund Newsom’s favored programs, including an effort to address homelessness and a public safety campaign promoting the importance of wearing masks.

The corporations say they were simply trying to help the state in a time of need. But no matter how noble the cause, critics fear the donations could allow corporations to hold more sway in state government. They noted many of the donors have other business before the governor, received no-bid government contracts over the last year or were seeking favorable appointments on important state boards, which they say creates the appearance of a pay-to-play system….

Under California law, a donation is considered a behested payment when an elected official or someone acting on their behalf asks an organization to donate money or services to a nonprofit or government agency for a legislative, governmental or charitable purpose, such as supplying free air time to run public health ads or giving cash to the governor’s program promoting volunteerism. General requests for charitable donations not directed at any particular organization are not required to be reported as behested payments, according to the state’s campaign finance watchdog agency, the Fair Political Practices Commission.

The top donor of behested payments to Newsom in 2020 was tech giant Facebook, which gave $27 million for gift cards that went to front-line healthcare workers and for public health ads. Facebook founder Mark Zuckerberg and his wife, Dr. Priscilla Chan, gave another $3.7 million for COVID-19 related efforts such as polling services aimed at improving public health response and help with the state’s public awareness campaign, as well as money for the state’s wildfire recovery efforts.

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“Focus on Trump’s official White House actions as part of Republican convention programming raises Hatch Act concerns”


The decision by the Republican National Convention to feature President Trump conducting official business inside the White House underscores how he is leveraging the powers of his office for political gain, raising questions about whether an event featured Tuesday night violated federal law.

In a remarkable pretaped scene packaged as part of the convention’s prime time programming, Trump took part in a naturalization ceremony for five new citizens as acting Homeland Security Secretary Chad Wolf administered the Oath of Allegiance….

Kathleen Clark, a legal and government ethics professor at Washington University School of Law in St. Louis, said that the event appeared to be designed as part of the convention, an action that would violate a criminal provision of the Hatch Act, which bars executive branch employees from participating in politics in their official capacity.

Under the act, federal employees are prohibited from using their authority to influence the election of a presidential candidate, she said, calling Trump and Wolf “breathtaking in their contempt for the law.”

A White House official, who spoke on the condition of anonymity to describe the legal basis of the event, said it was part of the president’s official schedule that was publicized on a public website.

“The campaign decided to use the publicly available content for campaign purposes,” the official said. “There was no violation of law.”

The most widely known civil provisions of the Hatch Act do not apply to the president and the vice president. But the law applies to executive branch employees who are involved in planning or executing any political events staged at the White House, including video segments filmed there, experts said.

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“As Election Nears, Trump’s White House Grows Bolder in Flouting Ethical Norms”


When President Trump holds official taxpayer-funded events outside Washington, his audiences are treated to campaign-style speeches and rock music playlists drawn from his political rallies. His appearances at the White House, most recently a rambling Rose Garden news conference, are increasingly devoid of policy and filled with attacks on the “radical left” and the presumptive Democratic presidential nominee, former Vice President Joseph R. Biden Jr.

And on Tuesday, Mr. Trump’s eldest daughter and senior adviser, Ivanka Trump, a White House employee, posted a photograph online celebrating Goya Foods, whose chief executive had recently praised her father, in what government ethics experts called a clear violation of federal law. The president followed up on Wednesday with his own photograph, featuring the company’s products arrayed on the Resolute Desk in the Oval Office.

Mr. Trump and his advisers have long tested — and often crossed — the boundaries between the official and the political. The Office of Special Counsel, an independent government watchdog agency, has found 13 Trump officials in violation of the Hatch Act, the 1939 law limiting the political activities of government employees, according to Citizens for Responsibility and Ethics in Washington, or CREW. Staff members with the watchdog group said they could recall only two such instances under President Barack Obama.

But with the general election in November little more than 100 days away, the coronavirus quashing Mr. Trump’s raucous rallies, and the White House lacking a clear policy agenda, the Trump administration seems almost entirely unconstrained by traditional divisions between politics and governance.

“Every White House I have known until this one — of both parties — has rigorously worked to separate campaign activity and official business,” said Trevor Potter, a Republican and a former chairman of the Federal Election Commission who is now the president of the Campaign Legal Center.

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“FBI serves warrant on senator in investigation of stock sales linked to coronavirus”


Federal agents seized a cellphone belonging to a prominent Republican senator on Wednesday night as part of the Justice Department’s investigation into controversial stock trades he made as the novel coronavirus first struck the U.S., a law enforcement official said.

Sen. Richard Burr of North Carolina, the chairman of the Senate Intelligence Committee, turned over his phone to agents after they served a search warrant on the lawmaker at his residence in the Washington area, the official said, speaking on condition of anonymity to discuss a law enforcement action.

The seizure represents a significant escalation in the investigation into whether Burr violated a law preventing members of Congress from trading on insider information they have gleaned from their official work.

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“Loeffler reports more stock sales amid insider trading allegations”


U.S. Sen. Kelly Loeffler’s most recent financial disclosures show that millions of dollars in stocks were sold on her behalf at the same time Congress was dealing with the impact of the coronavirus.

The largest transactions — and the most politically problematic — involve $18.7 million in sales of Intercontinental Exchange stock in three separate deals dated Feb. 26 and March 11. Loeffler is a former executive with ICE, and her husband, Jeff Sprecher, is the CEO of the company, which owns the New York Stock Exchange among other financial marketplaces.

During the same time period reflected on reports filed late Tuesday, the couple also sold shares in retail stores such as Lululemon and T.J. Maxx and invested in a company that makes COVID-19 protective garments. The Atlanta Journal-Constitution got the first look at these reports, covering mid-February through mid-March and shedding new light on Loeffler’s financial transactions during the pandemic. Previous reports — which have put Loeffler in the national spotlight — covered her trading during the first six weeks of 2020.

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