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Home / US / Financial revelations reveal postmaster general’s business troubles and potential conflicts of interest, experts say

Financial revelations reveal postmaster general’s business troubles and potential conflicts of interest, experts say



External experts who spoke to CNN were shocked that ethics officials at the postal service approved the deal, which allows DeJoy to hold at least $ 30 million in XPO units.

DeJoy and the USPS have said he is in full compliance with the regulations.

Raising further alerts, on the same day in June that DeJoy removed large amounts of shares in Amazon, he bought stock options giving him the right to buy new Amazon shares at a much lower price than the price. their current market, according to the findings.

DeJoy already faces bipartisan criticism for implementing divisive changes after taking over the USPS on June 15, including eliminating overtime for many workers. Democrats also claim he is slowing mail delivery to sabotage the missing vote in the November election ̵
1; a charge he denies.
The Trump administration takes unusual steps to put its stamp on the Postal Service ahead of the November election
Prior to joining the administration, DeJoy, an ally and fundraiser, was on the board of directors at XPO Logistics, a major transportation and logistics company that does business with the USPS and has contracts with other US government agencies, such as the Department. of Defense. In 2014, XPO acquired DeJoy’s New Breed Logistics for $ 615 million.
These questions about DeJoy come at a time of tremendous strain on the USPS. The agency is already caught for money and is facing funding shortages. And two members of the governing body stepped down earlier this year, at least in part, to protest the efforts of Trump aides to control the USPS finances and operations. DeJoy supporters say he is the right person for the job because he can lead the agency at war with his business expertise.

‘Does not pass the aroma test’

U.S. Postman General Louis Dejoy arrives at a meeting in the office of the Speaker of the House of Rep.  Nancy Pelosi (D-CA) at the US Capitol August 5, 2020 in Washington, DC.
When announcing DeJoy’s appointment, the USPS board of governors noted that New Generation “was a U.S. Postal Service contractor for more than 25 years,” and received high-quality awards in the 1990s. did not mention the XPO’s ongoing connections to the USPS.

According to federal records, when he became postmaster general, DeJoy still owned a large stake in XPO, totaling between $ 30 million and $ 75 million. Federal ethics officials recently approved his decision to hold these assets, but decades-old foreign experts in government are raising red flags.

“The idea that you could be a postmaster general and hold tens of millions of shares in a postal service contractor is quite shocking,” said Walter Shaub, the former director of the Government Ethics Office, who resigned in 2017. “It could be that he is planning to sell it, but I do not understand the delay. He has managed to deviate many other things. And if he was not willing to sell it, he should not have taken the job.”

Schaub, who is now a senior Citizens’ Adviser for Accountability and Ethics in Washington, suggested that if DeJoy does not relinquish his property soon, it could be interpreted as an illegal conflict of interest. Schaub also asked why ethics officials approved the deal.

It is illegal under federal law for federal government employees or their spouses to have a “financial interest” in companies that intersect with their official duties. Ethics experts who spoke to CNN said DeJoy could have eased these conflicts by deviating, agreeing ahead to repeal itself on some issues, taking legal action, or even building a blind faith.

“If you have a $ 30 million interest in a company, it will certainly affect you,” said Stuart Gilman, who spent 12 years in the Government Ethics Office, where he was assistant director. “I would assume there is a problem here. It obviously does not pass the aroma test.”

Democrats call for investigation

A USPS spokesman previously told CNN that DeJoy followed all ethics requirements. Federal Ethics Officers approved the required DeJoy financial records in June, July, and earlier this month.

“No issues relating to XPO Postal Service contracts have been referred to Postmaster General DeJoy, nor will any such issue be expected to rise to that level,” said USPS senior ethics adviser Jessica Brewster-Johnson. for CNN. “Decisions about XPO contracts are made at much lower levels in the organization. If, however, an XPO-related issue came before Postmaster General DeJoy, he would be forced to repeal himself or, if the rejection would not “It was practicable, the Ethics Office would ask for the removal. So far, no such issue has arisen.”

Experts who spoke to CNN said the explanation was “clumsy” and “absurd”, especially since the rules require senior officials to avoid even the appearance of a potential conflict.

Federal records also show that DeJoy owned between $ 265,000 and $ 550,000 in UPS shares, but dismissed them after becoming general postmaster in June. Experts praised the move because it eliminated a conflict of interest, as UPS is a direct competitor to the postal service.

A group of Senate Democrats, led by Massachusetts Sen. Elizabeth Warren, urged Inspector General of the USPS to investigate policy changes that DeJoy imposed this summer and examine whether DeJoy “met all ethics requirements” regarding with his personal finances and stock XPO. A spokesman for the USPS guards declined to say whether they were launching an investigation.

DeJoy made dozens of stock sales and purchases around the time he started in the USPS. He diverted at least $ 100,000 in XPO options, but apparently held on to his larger equity stocks. He also possesses options to buy an additional 270,000 shares in XPO, at various prices in the future. These options expire in November.

Around the time he took over the USPS, DeJoy bought and sold shares or stock options in a wide range of industries, including health companies like Johnson & Johnson and Abbott Laboratories, which are involved in the pandemic response. He also sold shares in Coca-Cola and Uber, and bought shares in ExxonMobil. These financial transactions continued after DeJoy joined the USPS, according to federal data.

Amazon Trades

DeJoy trades in Amazon stocks are also facing huge control. According to his financial revelations, DeJoy owned between $ 100,000 and $ 250,000 in shares in Amazon when he joined the administration.

On June 24, DeJoy diverted those shares, but on the same day he bought a new financial interest in the company, buying between $ 50,000 and $ 100,000 in stock options for Amazon. The stock options, which expire on October 16, give DeJoy the right to buy Amazon shares at a price of $ 1,960 per share. Shares on Amazon are currently trading at more than $ 3,100.

“It’s another conflict. He has the opportunity to buy. That means he’s proud that Amazon’s value will increase,” said Marcus Owens, a former senior IRS official with decades of experience dealing with the rules. federal ethics. “Why is he investing in a competition of the company he is supposed to manage? This is a classic case for investigation by an inspector general.”

Given the President’s repeated criticism of Amazon and his contracts with the Postal Service, those stock trades kept a close eye on ethics experts. Trump has publicly attacked the Amazon and the Washington Post, which is owned by Amazon founder Jeff Bezos. And Trump has privately complained about the Washington Post coverage while attacking Amazon, the newspaper reported.

“This is pretty wild, to get into government and then buy conflict (interests),” Shaub said. “He partially eliminated a conflict of interest and then bought a new one the same day.”

Most recently last week, Trump called Amazon by name while criticizing USPS price points.

The USPS claims that DeJoy’s ownership of XPO shares, and those of other assets, is no longer problematic. USPS officials also say their new leader is not trying to sabotage the 2020 election with postal delays, and that he is following all proper ethics rules.

“I take my ethical obligations seriously and have done what is necessary to ensure that I am and will abide by those obligations,” DeJoy said in a statement to CNN.


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