Research from RPT has exposed Chao’s failures to divest and actions that may have benefitted her family’s private shipping company
WASHINGTON — After months of explosive press stories exposing Transportation Secretary Elaine Chao’s corruption, the House Oversight and Reform Committee will investigate her ethically questionable actions to benefit herself and her family. Following the news, Restore Public Trust Director Lizzy Price released the following statement:
“For too long, Secretary Chao has evaded Congressional inquiry, but now the tide is high,” said Lizzy Price, Director of Restore Public Trust. “Secretary Chao’s misuse of her taxpayer-funded position to benefit herself and her family is wrong and harms our democracy. This request letter is a big step in the right direction — but there’s more to be done. We applaud the House Oversight and Reform Committee and implore them to investigate not only her failure to divest and her dubious family business dealings, but also the many other corruption allegations raised against her, including that she’s funneled grant money into Kentucky, where her husband Mitch McConnell will face a tough re-election fight over the next year. With so many shady dealings in her books, Secretary Chao’s misconduct deserves the full attention of the Committee.”
The House Oversight and Reform Committee sent Chao a letter today requesting she turn over all communications since President Trump’s inauguration between her department and the Foremost Group, as well as other related documents. The Committee will also investigate Chao’s failure to divest from a company that directly lobbies her department after she was sworn in as transportation secretary.
Restore Public Trust has worked to expose the issues Chao will now answer for including:
- Failure to Divest: Despite a written commitment to immediately divest in companies that directly engage with DOT, Chao failed to do so. Restore Public Trust asked the Inspector General to investigate.
- Shady Family Business: Chao is accused of using her position to help her family’s shipping company profit overseas. Chao family members have thanked her by gifting millions in donations and personal gifts to help her husband’s political career. Restore Public Trust filed a lawsuit to get records from the DOT they requested months ago.
The Committee should also investigate Chao’s other ethics scandals including:
- Kentucky: Research shows Chao is using her position to award millions of grant dollars to contractors and projects in Kentucky, the state where her husband, Senate Majority Leader Mitch McConnell, will face tough re-election for Senate in 2020.
- She touted her work to bring federal dollars back to Kentucky, stating she will “try not to come” to Kentucky “empty-handed,” and at her direction, DOT spent nearly $14 million on projects located in Kentucky in 2018 — over an $11 million increase in funding from the final year of the Obama Administration
- She even guided major DOT projects to her home state of Kentucky in an effort to boost the political career of her husband (raising questions about Hatch Act violations) and turning the small town of Paducah into her own personal swamp
- Her office created a path through a special liaison at DOT for McConnell’s Kentucky interest projects.
- Wells Fargo: Restore Public Trust also exposed Chao’s scandal-plagued tenure as a member of Wells Fargo’s Board of Directors before resigning to head USDOT.
- The scandal she is still embroiled in is part of a $240 million payout to shareholders who sued her and other Wells Fargo representatives for neglecting their management duties.
- During her tenure on the Wells Fargo Board of Directors, the bank preyed on consumers, including creating up to 3.5 million fake deposit accounts and that it often targeted vulnerable consumers.
- Chao, who was tasked in part with overseeing Wells Fargo’s ethics and fair corporate practices, failed to prevent massive fraud the bank committed against its customers, including improperly repossessing veterans’ cars and wreaking havoc on their credit
- Chao is still getting paid by Wells Fargo, her compensation includes stock payouts of up to $5 million over the course of five years — 30 percent of which she was paid in March; meanwhile, veterans are still struggling to recover financially
- Secret Schedule and Wasted Taxpayer Dollars: Chao has hidden her schedule. She has claimed nearly 300 hours of private time, the equivalent of seven weeks’ vacation, during her first 14 months as transportation secretary. Since the accusation became public, she has neglected to answer for the unaccounted hours.