Restore Public Trust Calls For Investigation of Secretary Chao For Potential Financial Conflict

WASHINGTON — Today, Restore Public Trust, a government watchdog group, called on the Department of Transportation (DOT) to open an investigation into Elaine Chao, Secretary of Transportation, for having likely violated financial conflict-of-interest restrictions under federal law.

Upon nomination to the office, Chao submitted a letter outlining the steps she would take to “avoid any actual or apparent conflict of interest” if she were confirmed as Secretary, including divesting her shares in Vulcan after serving on their board and recusing herself from matters involving the company until her shares were divested. But according to news reports, Secretary Chao failed to divest from her financial stake at Vulcan Materials, a construction company where she served on the board of directors. And she also failed to recuse herself from all matters involving the company. Vulcan spent nearly a million dollars on firms to lobby the DOT, and the company has lobbied DOT every quarter since Chao’s confirmation.

“Every new story makes it clear that the depths of Secretary Chao’s corruption seem to be never-ending,” said Kyle Herrig, Senior Advisor for Restore Public Trust. “Whether it’s helping her family’s shipping business, prioritizing contracts and grants to her state where her husband, the Senate Majority Leader, is running for re-election, or failing to divest her own financial conflicts, instances of Chao’s corruption continue to pile up. Even in an Administration that has shown a disdain for ethics and the rule of law, Chao’s actions stand out.

“Despite Chao’s pledge to Congress and the American people that she would divest from Vulcan Materials, she failed to do so. The clear conflicts of interest between the work of the transportation department and the work of Vulcan Materials should be fully investigated by the Office of Inspector General immediately.”

In June 2018, DOT announced a $184 million grant to the Georgia Department of Transportation to fund the construction of express toll lanes on a congested highway in Georgia. There is absolutely no indication that Secretary Chao recused herself from any and all grantmaking processes where Vulcan Materials served to benefit. In fact, just a month after this award, Secretary Chao traveled to Georgia to “celebrate” the issuance of the grant with employees of Vulcan Materials.

And there may have been a lot to celebrate. Vulcan Materials is an aggregates producer listed on the “Qualified Products List” produced by the Georgia Department of Transportation’s Office of Materials and Testing, meaning that Georgia has certified Vulcan Materials as an approved source of materials to build roadways. In other words, Secretary Chao may have participated personally and substantially in grantmaking processes in which she has a financial interest, by virtue of the shares she continues to hold in an aggregates producer that profits considerably from DOT-funded projects.

Given the broad intersection of DOT’s programs and Vulcan Materials’ work, there are almost certainly other instances in which Secretary Chao may have participated personally and substantially in particular matters involving Vulcan Materials—in which she continues to maintain a financial interest.  

Link to Complaint Here.

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