ate last night, after the daily news cycle had gone to sleep, Secretary of Commerce Wilbur Ross issued a statement: “To maintain the public trust, I have directed that all of my equity holdings be sold and the proceeds placed in U.S. Treasury securities.” The announcement came the same day that the federal government’s top ethics official sent Ross a letter making it clear he had eroded public trust and scolded him for filing false and incomplete documents. The letter also said an official at the Department of Commerce had reviewed Ross’ calendars to see if the commerce secretary broke the law by taking actions that affected his financial interests. “He found no information indicating any such violation.”
Forbes, however, has found information indicating otherwise. A detailed review of Ross’ calendar from February to November 2017—his first months in office—reveals dozens of meetings with companies tied to his personal fortune, which he built up over years in private equity. Last March, his calendar lists a meeting with the CEO of Boeing, a company in which Ross’ wife held nearly $3 million worth of stock. In April, his schedule includes another with Minister Ali Shareef Al Emadi, who serves on the board of Qatar Investment Authority, a sovereign wealth fund that pumped money into one of Ross’ private equity vehicles. In July, September and October, Ross’ agenda lists talks with Bill Ford, executive chairman of Ford Motor Company, which called a business Ross partly owned a “top performing global supplier.” And so on, and so on. “Secretary Ross and [chief of staff] Wendy Teramoto have not taken any action with a direct and predictable effect on their financial holdings,” a spokesman for the commerce department said in a statement. “This applies to all the meetings.”
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U.S. Secretary of Commerce Wilbur Ross
Whether Ross’ false statements and incomplete filings were illegal depends on whether Ross merely made sloppy mistakes or intentionally lied, according to ethics experts. It’s a fine line, one Ross has danced around before. After he apparently lied to Forbes about his personal fortune for years, then got caught on tape doing so as commerce secretary, his spokesperson issued a statement saying it was a misunderstanding. That sounds a lot like the explanation Ross is now attributing to his false filings: “I have made inadvertent errors in completing the divestitures required by my ethics agreement.”
If Ross lied to federal officials, then he broke the law. If he took actions that impacted his personal holdings, then he may have committed additional crimes. Former EPA chief Scott Pruitt became a punching bag for his endless string of ethical lapses, but his misadventures, including reportedly pursuing a Chick-fil-A franchise for his wife and an old mattress from Trump International Hotel, are positively nickel-and-dime compared with Ross’ big-money foibles. As the examples pile up, Ross personifies the inherent issue with government officials retaining entangled holdings, a concern that the commerce secretary has been flouting more than anyone in years—with the exception of his boss, President Donald Trump.
he day Wilbur Ross became secretary of commerce, the Motor & Equipment Manufacturers Association sent him a congratulatory letter: “Your distinguished business career and experience working with manufacturing companies make you uniquely qualified to lead in the new administration.”
Uniquely qualified indeed. The trade group likely knew Ross had reason to protect its interests when it sent the letter. One of the companies that signed at the bottom was “IAC,” apparently International Automotive Components Group, a giant car parts manufacturer that at the time was partially owned by Wilbur Ross. It was almost as if Ross were writing a letter to himself.
The Motor & Equipment Manufacturers Association wanted a meeting with the commerce secretary and got one on April 24, 2017, according to Ross’ calendar. A spokesperson for the trade group said they discussed taxes and trade issues, including NAFTA. Ross did not get rid of interests in the car parts company until six months later, when he apparently gave some to a trust for family members and sold others. A spokesman for the commerce department would not detail the topics addressed in Ross’ meetings with business associates of International Automotive Components Group.
On March 17, Ross’ calendar lists a sit-down with BMW chairman Harald Krueger. On April 26, it shows a meeting with Jim Lentz, the CEO of Toyota Motor North America. In June and October, it includes meetings with Mary Barra, CEO of General Motors. And September 20 and October 6 it lists conversations with Bill Ford. All had significant interests before Ross, including the imposition of tariffs on aluminum and steel. And all have been customers of International Automotive Components Group.
If Ross discussed only broad issues, like NAFTA, he may be able to claim that he broke no laws. According to ethics experts, officials cannot take action on narrow matters that will affect their business, but they can work on more general policies even if those policies will affect their holdings. That’s right: U.S. law allows an official like Ross to take actions that will impact his own bottom line—if those actions are significant enough to also affect the greater economy. It’s a remarkable loophole.
The commerce secretary may have more difficulty claiming he followed the law in his meetings with Chevron and Boeing. According to his calendar, Ross hosted John Watson, then-CEO of the oil giant, in his conference room on March 22, 2017, at 9:30 a.m., just before heading to the White House for a meeting with Trump. Ross’ wife apparently held more than $250,000 worth of shares in Chevron at the time, according to federal ethics filings. Meanwhile, Chevron was lobbying the Department of Commerce and other offices about trade and oil issues. “As per our long-standing policy,” a spokesperson for the company said, “we do not discuss specific meetings with government officials.”
Eight days later, the commerce secretary’s schedule lists a meeting with Dennis Muilenburg, the CEO of Boeing, in which Ross’ wife also held a stake, apparently worth nearly $3 million. A spokesperson for the commerce department again refused to answer questions about the meeting. But in lobbying disclosures that covered the first few months of 2017, Boeing said it pushed the federal government, including the Department of Commerce, on a handful of matters. And when asked about meetings between Ross and Muilenburg, a Boeing spokesperson suggested they included exactly the kind of conversation that could get the commerce secretary in trouble. “Boeing meets regularly with officials across the U.S. government to discuss policy matters impacting our business, the aerospace industry, and our workforce,” the spokesperson said. “These meetings were in line with that long-standing practice.”
ay 18, 2017 was a busy day for Secretary of Commerce Wilbur Ross. He arrived at the Mayflower Hotel in downtown Washington, D.C., for a morning event with the president of Colombia, attended a hearing on trade deficits, took a call from a governor, met with a foreign minister, had a talk with a second governor, then another one with an ambassador, all according to Ross’ calendar. He kept his schedule packed into short segments, sometimes double-booked. The only thing allotted more than 45 minutes? Lunch. For that, Ross went to the White House, where he dined next to the Situation Room, in a wood-paneled bunker adorned with paintings of ships. He brought two guests with him, “Wendy and Bill Furman,” according to his calendar.
They had a lot to discuss. Bill Furman serves as the CEO of a railcar manufacturer called Greenbrier Companies. Wendy is apparently Wendy Teramoto, Ross’ chief of staff, who served on Greenbrier’s board of directors from 2009 through March 2017, while she was employed at Ross’ private equity firm. A Greenbrier representative declined to comment on the meeting. A spokesman for the Department of Commerce described the lunch as “purely social,” and added that “no items specific to Greenbrier have been before the secretary during his tenure at commerce.” He failed to note that Greenbrier was actively lobbying other parts of the government on the North American Free Trade Agreement, or that Ross issued a press release that very same day announcing he would be working with President Trump to renegotiate the deal.
Nor did the spokesman mention that, at the time of that meeting, Teramoto apparently held an interest in Greenbrier Companies. Ross also had an interest in the company, which he had not included on his financial disclosure report, even though he was required to do so by law.
Ross also did not list a shipping company called Nautical Bulk Holding anywhere on his financial disclosure report. The commerce secretary did, however, include an interest in a private equity fund called WLR Recovery Fund V. And according to documents reviewed by Forbes, the largest single investment in WLR Recovery Fund V is Nautical Bulk Holding. It appears the commerce secretary held an interest in the shipping firm for most of last year, then dumped part of it into a family trust in October 2017, without publicly disclosing that he ever owned a stake in the company.
That’s especially significant because of the nature of Nautical Bulk Holding’s business. The company was founded to finance the construction of 20 vessels in a Chinese shipyard. Which means that Wilbur Ross, one of Trump’s top lieutenants in America’s trade war with China, apparently had a hidden interest in a company connected to China for most of last year.
Similar ties extend around the world. As Forbes reported last month, for most of last year Ross was actually a business partner of the Chinese government, held onto a shipping firm tied to Vladimir Putin’s inner circle, and even owned a stake in a big business whose industry he is now investigating.
There’s more. Ross scheduled meetings with top economic officials in Greece while holding an interest in a major Greek bank. He held investments in a Brazilian auto parts company when he was scheduled to meet with Brazilian officials. His calendar lists meetings with leaders of three state-controlled funds—from Qatar, Japan and Singapore—that had previously handed money to his private equity firm, according to former employees. The agenda also includes meetings with the CEOs of major airlines, who were customers of an aircraft leasing company in which Ross had a stake. And while the commerce secretary owned an interest in a real estate lender set up to do business involving the Irish government, he met with the prime minister of Ireland, in the Oval Office, alongside Donald Trump.
n May of last year, Wilbur Ross negotiated a deal to promote natural gas exports to China, then took a cable-news victory lap, appearing on Fox, CNBC and Bloomberg. But he was careful not to claim all the credit for himself. “Really a lot of the work was done by Wendy Teramoto, my chief of staff,” he said on air.
In a later statement, the commerce department claimed Teramoto did not become chief of staff until August 2017, three months after Ross lauded her work. Previously, she held a murkier role, working for both Ross’ old private equity firm and the Department of Commerce at the same time.
Teramoto eventually left the private equity firm, but she may not have ever fully let go. In December, a commerce department spokesman said that she continued to own interests in Navigator Holdings and Diamond S Shipping, the firms tied to Putin’s inner circle and the Chinese government. When recently asked, the spokesman declined to provide an update, but Forbes found no evidence that Teramoto has completely divested. By federal law, officials must file documents when they buy or sell assets for more than $1,000. Teramoto filed paperwork showing that she sold off interests in six companies in June and October last year, but as of May, she had not filed documents explaining what she did with her interests in WL Ross funds—which held Navigator, companies co-owned by the Chinese, a Cypriot bank reportedly tied up in the Robert Mueller investigation, and so forth. It could all leave her especially vulnerable to federal conflict-of-interest laws.
For Ross’ part, he says he has divested from that same group of holdings. In October, he transferred some interests to his family members and sold others to funds managed by an outside firm, Goldman Sachs. And although a spokesperson for the bank said, “the transaction was not discussed,” Ross met in his office on May 17, 2017, with none other than Goldman CEO Lloyd Blankfein.
Reach Dan Alexander at [email protected] Cover image by Bloomberg.
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