Financial disclosures reveal business entanglements and likely conflicts of interest in Postmaster’s Office, experts say
Outside experts who spoke to CNN were shocked that Postal Service ethics officials approved the arrangement, which allows DeJoy to keep at least $ 30 million in XPO’s holdings.
DeJoy and USPS have said it is in full compliance with the regulations.
Leaping further alarms, on the same day in June that DeJoy sold large amounts of Amazon stock, he bought stock options giving him the right to buy new Amazon stock at a price. well below their current market price, according to the revelations.
‘Do not pass the odor test’
According to federal records, when he became Postmaster General, DeJoy still had a large stake in XPO, totaling between $ 30 million and $ 75 million. Federal ethics officials recently approved his decision to keep those assets, but outside experts with decades of experience in government are raising red flags. Get a same day loans now
Schaub, who is now a senior advisor at Citizens for Responsibility and Ethics in Washington, suggested that if DeJoy does not divest his stakes soon, it could be interpreted as an illegal conflict of interest. Schaub also asked why ethics officials approved this arrangement.
“If you have a $ 30 million interest in a company, of course that will have an impact on you,” said Stuart Gilman, who spent 12 years at the Office of Government Ethics, where he was deputy director. “I guess there’s a problem here. It sure doesn’t pass the odor test.”
Democrats call for investigation
A USPS spokesperson previously told CNN that DeJoy meets all ethical requirements. Federal ethics officials approved the financial deposits required by DeJoy in June, July and early this month.
“No questions relating to XPO’s postal service contracts have been presented to Postmaster General DeJoy, and such questions are not expected to reach this level,” the senior ethics adviser at CNN told CNN. USPS, Jessica Brewster-Johnson. “Decisions about XPO contracts are made at much lower levels of the organization. If, however, a problem with XPO were presented to Postmaster General DeJoy, he would be forced to recuse himself or, if recusal was not possible, the Ethics Office would demand an assignment. To date, no such problem has arisen. ”
Experts who spoke to CNN said this explanation was “sloppy” and “absurd,” especially because the rules require senior officials to avoid even the appearance of a potential conflict.
Federal records also show DeJoy owned between $ 265,000 and $ 550,000 in UPS stock, but sold them after becoming postmaster in June. Experts welcomed the move, as it eliminated a conflict of interest, as UPS was a direct competitor of the postal service.
DeJoy made dozens of stock sales and purchases around the time he started USPS. He divested at least $ 100,000 in XPO options, but apparently kept his larger holdings. He also holds options to buy an additional 270,000 shares in XPO, at varying prices going forward. These options all expire in November.
Around the time he took over the USPS, DeJoy bought and sold stocks or stock options in a wide range of industries, including healthcare companies like Johnson & Johnson and Abbott Laboratories. , who are involved in the response to the pandemic. He also sold shares of Coca-Cola and Uber, and bought shares of ExxonMobil. These financial transactions continued after DeJoy joined USPS, according to federal records.
DeJoy’s trading in Amazon shares is also coming under scrutiny. According to his financial information, DeJoy held between $ 100,000 and $ 250,000 in Amazon stock when he joined the administration.
On June 24, DeJoy sold those shares, but on the same day he bought a new equity stake in the company, buying between $ 50,000 and $ 100,000 in stock options for Amazon. The stock options, which expire Oct. 16, give DeJoy the right to buy Amazon stock at a price of $ 1,960 per share. Amazon shares are currently trading at over $ 3,100.
“It’s another conflict. He has the ability to buy. That means he’s betting Amazon’s value will increase,” said Marcus Owens, a former senior IRS official with decades of experience in the field of federal ethics rules. “Why is he investing in a competitor of the company he is supposed to manage? This is a classic case of investigation by an inspector general.”
“It’s quite outrageous to come into government and then buy conflicting (interests),” Shaub said. “He partially eliminated a conflict of interest, then bought a new one the same day.”
As recently as last week, Trump referred to Amazon by name while criticizing USPS pricing.
The USPS maintains that DeJoy’s ownership of the XPO stake, and these other assets, is not in itself a problem. USPS officials also said their new leader was not trying to sabotage the 2020 election with postal delays and was following all the proper ethics rules.
“I take my ethical obligations seriously, and have done what is necessary to ensure that I am and will remain in compliance with those obligations,” DeJoy said in a statement to CNN.