Committee leaders release DOT Inspector General’s ethics report on former Secretary Elaine Chao

Written by David C. Lester, Managing Editor
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U.S. DOT Office of Inspector General alleges former U.S. Secretary of Transportation Elaine Chao committed ethics violations while in office.
U.S. DOT

[Yesterday], Chairman of the House Committee on Transportation and Infrastructure Peter DeFazio (D-Ore.) and Chairwoman of the Committee on Oversight and Reform Carolyn Maloney (D-N.Y.) released the report from the Department of Transportation Office of Inspector General (DOT OIG) [on the] ethics investigation into former Secretary of Transportation Elaine Chao.

Both Chairs requested the investigation in 2019 amid public reports that raised questions about the former Secretary’s actions relating to her financial interest in Vulcan Materials, a stone and asphalt company; her influence over discretionary grants to her home state of Kentucky.; and possible ethics violations regarding the use of her official position to help her family’s shipping business.

In December 2020, Committee on Oversight and Reform staff also transmitted to the DOT OIG documents that the Committee had received from the Department over the course of its investigation. A selection of those documents can be found here

“While I commend the Department of Transportation’s Office of Inspector General for conducting this review, I am disappointed that it was not completed and released while Secretary Chao was still in office,” Chairman DeFazio said. “I am even more disappointed that the Department of Justice declined to further pursue the matters that the IG’s office substantiated in its investigation. Public servants, especially those responsible for leading tens of thousands of other public servants, must know that they serve the public and not their family’s private commercial interests.”

“The DOT Inspector General’s report, in addition to documents we obtained, demonstrate that Secretary Chao used her official position and taxpayer resources for the benefit of herself and her family,” Chairwoman Maloney said. “Secretary Chao’s flagrant abuse of her office provides further evidence that additional ethics and transparency reforms are needed.”

Based on its preliminary review of the issues identified by the Committees, the DOT OIG launched a formal investigation into the Secretary’s potential misconduct and ethical issues surrounding her potential “use of public office for private gain.”

The report highlights four separate categories [of] actions by then-Secretary Chao that appear to have violated Federal ethics laws:

  • Secretary Chao tasked political appointees on her staff to contact the Department of Homeland Security regarding the status of a work permit application for a student studying at a U.S. university who was a recipient of her family’s philanthropic foundation.
  • Secretary Chao made extensive plans to include family members in events during her planned, but subsequently cancelled, official trip to China in November 2017 that included intended stops at schools and other locations that had received support from her family’s business. In an email about attendees for a meeting with “top leaders” (presumably of the Chinese government), Secretary Chao also instructed her staff to include her father, her sister, and her sister’s husband, while at the same time instructing them that for the DOT, the attendees would be “none.”
  • Secretary Chao directed DOT public affairs staff to provide support to her father, particularly in the marketing of his personal biography, to keep a running list of the awards her father received and edit her father’s Wikipedia page. Secretary Chao also “directed two OST staffers to send a copy of [her father’s book] to a well-known CEO of a major U.S. corporation (which is not regulated by DOT) along with a letter requesting that he write a forward for the book and a sample forward.” 
  • Secretary Chao also used DOT resources and staff for personal tasks, such as checking on repairs of an item at a store for her father and having them send Christmas ornaments to her family.

In December 2020, based on the factual evidence uncovered in the DOT OIG’s Report of Investigation, the office sent a criminal referral on the matter to both the Department of Justice U.S. Attorney’s Office for the District of Columbia and to the DOJ Public Integrity Section. However, both offices declined to open an investigation into these matters. DOT OIG wrote, “Based on the lack of prosecutorial interest from DOJ, OIG has determined it will close this investigation.”

Click here to read the DOT OIG report.

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