Money and Democracy

Published — April 4, 2019

Ethics watchdog won’t certify Mnuchin report, but says questions raised by his wife’s company now addressed

U.S. Treasury Secretary Steven Mnuchin gestures as he speaks to media upon his arrival to a hotel with his Trade Representative Robert Lighthizer in Beijing, Thursday, March 28, 2019. (AP Photo/Andy Wong)

The unusual delay in approving Mnuchin’s disclosure documents prompted questions. 


The executive branch’s chief ethics watchdog today declined to certify Treasury Secretary Steven Mnuchin’s 2018 personal financial disclosure report, citing an issue raised by his wife’s film company, but said the concern has now been addressed by revisions to Mnuchin’s ethics agreement.  

The Office of Government Ethics “is unable to certify Secretary Mnuchin’s annual 2018 public financial disclosure report because he has an imputed interest in Stormchaser Partners LLC, which he agreed to divest,” Office of Government Ethics Director Emory Rounds wrote in a letter to Senate Finance Committee Chairman Charles Grassley, R-IA. Mnuchin’s wife, Louise Linton, owns Stormchaser.

Rounds noted however that  Mnuchin had been following advice from ethics officials at the Treasury Department, and those ethics officials “did not inform OGE of this advice, which had the effect of letting the Secretary reacquire, without prior approval from OGE, a financial interest in an asset he agreed to divest.”

Mnuchin has modified his ethics agreement, and “OGE is satisfied” that the changes will enable him to comply with applicable conflict of interest laws, Rounds wrote.

The Treasury Department did not immediately respond to a request for comment from the Center for Public Integrity. Treasury spokesman Tony Sayegh on Twitter posted a statement stressing that Mnuchin’s disclosure had been certified by career ethics officials at Treasury “and he has been in compliance with his ethics obligations at all times.”

“This is simply the result of a technical difference between OGE and Treasury’s career ethics officials. OGE has identified no conflict presented by the asset held by the Secretary’s wife,” Sayegh wrote.

A copy of Mnuchin’s revised ethics agreement, dated this week, shows Mnuchin has agreed to additional recusal requirements involving Stormchaser Partners, including recusing from “particular matters of general applicability involving the film industry which could affect Stormchaser.”

A letter from Treasury Assistant General Counsel Brian J. Sonfield to OGE confirmed that before Mnuchin and Linton married in June 2017, Treasury ethics officials concluded her continued ownership of Stormchaser posed no conflict, and advised the couple she did not need to divest it. The original requirement that Mnuchin divest his stake was “out of an abundance of caution.”

In March, the Center for Public Integrity reported the holdup in certification of Mnuchin’s financial disclosure could be related to questions over Stormchaser.

Previously, in responding to questions about the unusually lengthy delay in obtaining final certification for Mnuchin’s disclosure report, Treasury spokespeople have repeatedly stressed that Treasury ethics officials certified Mnuchin’s report and the secretary has consulted with them and followed their advice.

Mnuchin first filed the report in May 2018. He was the last member of President Donald Trump’s Cabinet waiting for a verdict on his legally required disclosures.

Refusing to sign off would have been unusual, though not unprecedented. The Office of Government Ethics in February refused to certify the report of Commerce Secretary Wilbur Ross, finding he was “not in compliance with his ethics agreement at the time of the report.” It also refused to certify the termination report filed by former U.S. Environmental Protection Agency head Scott Pruitt, citing ethics questions related to his rental of a Capitol Hill apartment.

Ethics officials had steadfastly refused to comment publicly on the reasons holding up Mnuchin’s report.

Mnuchin’s original ethics agreement, negotiated when he joined the government, required him to step down from the chairmanship of Stormchaser Partners and divest his own ownership interest in it within 90 days of his confirmation in February 2017. (Mnuchin also agreed to divest dozens of other assets that ethics officials said potentially presented conflicts of interest or the appearance of one.)

Mnuchin reported selling his interests in Stormchaser Partners in May 2017 for a total between $1 million and $2 million; values are reported in ranges. He and Linton weren’t married at the time, so her assets weren’t public, but Treasury has since confirmed she bought his interest.

The couple married in June 2017. As required, Mnuchin publicly disclosed Linton’s assets on the disclosure form he filed last year. Under ethics law, Linton owning the company is the same as Mnuchin owning it himself.

That means the divestment of Mnuchin’s ownership stake didn’t cure any conflicts as long as Linton owns it.

In addition, the Center for Public Integrity reported Stormchaser Partners itself owes Mnuchin between $1 million and $2 million, an amount equal to what he reported selling his stake in the company for back in May 2017.

Sen. Ron Wyden, D-Oregon, the ranking member of the Senate Finance Committee, said he is “concerned” by OGE’s decision not to certify Mnuchin’s report.

“Before being confirmed by the Senate, he signed an ethics agreement that said he would divest from Stormchaser Partners LLC. Rather than divest, he violated the spirit of his ethics agreement by selling his interest to his then-fiancee and then he violated the letter of the agreement when he reacquired the assets upon their marriage,” Wyden said. “Secretary Mnuchin has filed a new ethics agreement that concludes his interest in Stormchaser is above board. I’m baffled by the Office of Government Ethics’ and Treasury’s handling of this matter, and I plan to thoroughly review this matter and the details of Secretary Mnuchin’s modified ethics agreement.”

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