July 13, 2018: This story has been updated.
U.S. Commerce Secretary Wilbur Ross, under fire from government ethics officials over “various omissions and inaccurate statements” in his personal financial disclosures, said he would sell “all of my equity holdings” and invest the proceeds in U.S. Treasury securities.
Ross’ statement came the same day as a blistering letter from the acting head of the Office of Government Ethics, David Apol, who wrote that Ross’ failure to divest assets by the deadline in his federal ethics agreement “created the potential for a serious criminal violation on your part and undermined public confidence.” Ross has repeatedly said his breaking the divestiture deadline was inadvertent.
Ross’ late divestitures included between $10 million and $50 million of stock in Invesco Ltd., a firm to which Ross had sold his WL Ross and Company in 2006. Last week, the Center for Public Integrity reported that Ross’ Invesco stock value increased by at least $1.2 million and as much as $6 million between the end of May, when Ross was supposed to divest, and late December, when he actually did.
The actual amount of the increase in value would depend on the total number of shares Ross owned, which isn’t publicly known.
In his statement Thursday, Ross again said he had “made inadvertent errors in completing the divestitures required by my ethics agreement. My investments were complex and included hundreds of items. I self-reported each error, and worked diligently with my department’s ethics officials to make sure I avoided any conflicts of interest.”
In his letter, Apol of the Office of Government Ethics noted that Ross has said the late divestitures were inadvertent, and said ethics officials “have no information to contradict that assertion.” In addition, Apol said Commerce Department ethics officials reviewed Ross’ calendar, correspondence and briefing books and found no information to suggest a criminal violation occurred.
In addition to the Invesco stock, Ross reported late divestitures of smaller amounts of stock in Sun Bancorp Inc., the Greenbrier Companies Inc. and Air Lease Corp. In all cases, he said he had been unaware that he had still owned the stock, and moved to divest it when he found out.
Ethics officials also criticized Ross for opening short sale positions. He reported short sales of Sun Bancorp and a shipping company, Navigator Holdings.
Apol said Ross had failed to seek advice from Commerce Department ethics officials before opening the short positions, “which appear to have been an ineffective attempt to remedy your actual or apparent failure to timely divest assets per your Ethics Agreement.”
Don Fox, a former acting director and general counsel of the Office of Government Ethics, said in an email that the letter to Ross is unusual “because inaccuracies and omissions of this magnitude, coupled with Ross taking a position with regard to assets that he was supposed to have divested is so unusual.”
In addition, Fox said he was “concerned” that agency ethics officials had reviewed Ross’ calendar and other materials.
“That’s not what Ethics officials are supposed to do,” Fox said. Rather, he said, such investigations should be done by the Office of Inspector General of the Department of Commerce “whose job it is to develop facts to determine if the inaccuracies and omissions really were inadvertent, or if there are grounds for a referral to the Department of Justice.”
(Update, July 13, 2018, 12:07 p.m.: In a statement, Sen. Ron Wyden, an Oregon Democrat who serves as ranking member on the Senate Finance Committee, called for the Department of Justice to investigate Ross.
“The top federal ethics watchdog confirmed what anyone with eyes and ears already knew: Wilbur Ross’s stock trades and his failure to divest holdings he was required to sell seriously compromised his ability to act in America’s best interests, and may have broken the law. In light of this report the Justice Department should conduct a thorough investigation to ensure that Ross was working on behalf of all Americans and not just his own bank account.”)
Ross, among the wealthiest members of President Donald Trump’s administration, has found his sprawling financial portfolio the subject of concern since becoming commerce secretary in early 2017.
In March 2017, for example, the Center for Public Integrity reported that Ross, who’s helped lead Trump’s protectionist trade policy efforts, then owned a significant stake in Diamond S Shipping Group Inc., which owns medium-range tanker vessels that sail under Chinese flags.