Skip Navigation

Wilbur Ross’ Russian Conflict of Interest

Wilbur Ross, the United States Secretary of Commerce, has come under fire for callously stating that federal workers struggling to pay bills during the government shutdown should just take out loans. Yet Ross’ problematic behavior extends far deeper than his callous commentary. While politically embroiled figures such as former Health and Human Services Secretary Tom Price and former Environmental Protection Agency Administrator Scott Pruitt have been forced out of the  Trump administration following damning allegations about their legal and financial dealings, Secretary Ross has remained despite accusations of embezzling millions of dollars and maintaining several conflicts of interest. Perhaps most troubling is his failure to disclose holdings in the shipping firm Navigator Holdings, particularly due to its well-documented connections to Russian oligarchs and the country’s president, Vladimir Putin.

Ross’ dealings with Navigator make it clear that he has prioritized his financial holdings in the company over the requirements of his office, failing to disclose his stakes and recognize the clear ethical problem of continuing to be in business with members of Putin’s close circle. As Commerce Secretary Ross has extensive power to control the United States’ foreign trade and their business relations with other countries, impacting both the domestic and global economies.

The Department of Commerce was officially established in 1913 in order to “promote the general welfare through expansion of commerce and industry.” Today, the department maintains the same mission while taking on a surprisingly diverse array of tasks relating to international trade, economic growth, and technological advancement. These responsibilities include providing data necessary to support commerce and democracy, implementing international trade deals, issuing trademarks and patents, and supporting research and development. Under this rather large and nebulous department is the National Oceanic and Weather Administration, the Census Bureau, and the Bureau of Economic Analysis. While providing weather information and delivering the decennial census may seem unrelated, they are all clumped together under this larger mission of providing the necessary conditions for the promotion of American trade and industry.

Managing this enormous agency is a big job, one that requires deftness in policy at home and with other nations. Yet Ross has consistently undermined the responsibilities of the Department of Commerce by failing to divest his personal holdings in foreign companies and blatantly partaking in meetings and agreements with companies in which he has a financial stake.

Since being confirmed, Ross has held meetings in the White House with dozens of companies in which he has a financial stake, including Boeing and Chevron. Back in March 2018, he invited Chevron executives to the White House to discuss issues ranging from oil and gas developments, trade, and tax reforms, despite the fact that his wife still held over $250,000 in the company. Not even a year earlier, in September 2017, he hosted trade talks with Chinese officials while one of his investments, International Automotive Components Group, created a joint-venture with Shanghai Shenda Co., a firm tied to the Chinese government. While Ross was appointed to advocate for America’s economic interests internationally, it’s hard not to assume Ross had other interests in mind when he was talking to Chevron executives or Chinese government officials. With rampant conflict of interests, there is a risk that Ross may be inclined to grant personal favors and concessions from the government if they might put more money into his pocket.

Secretary Ross’ personal portfolio becomes even more ethically ambiguous when it comes to his financial interest in Navigation Holdings, a company intertwined with the complex scandals between the Trump administration and the Russian government. Back in February 2017, the NYTimes reported that Ross had “divested a significant portion of his holdings to avoid conflicts of interest before taking the helm of the Commerce Department.” He failed to divest key offshore investments in Navigator Holdings, however, which were revealed in the Paradise Papers, a collection of leaked internal records. These documents, held by Bermuda-based law firm, Appleby, include emails, presentations, and other data that reveals little known details about those involved in offshore finance.

Navigator is a company based in Britain that charters ships to transport materials for energy companies. Russian gas company Sibur is one of Navigator’s top clients, and as luck would have it, Sibur’s owners include Putin’s son-in-law, Kirill Shamalov, as well Putin’s friend and Russian billionaire who is subject to U.S. sanctions for being a member of Putin’s circle in response to Russia’s annexation of Crimea, Gennady Timchenko.

According to the International Consortium of Investigative Journalists, during the confirmation process, Ross’ disclosure of his Navigator investment was so discursive that the Senators voting on weren’t even aware of it. He claimed that he believed he had sold all of his shares in Navigator prior to assuming his governmental position but learned later that he still owned shares. While knowledge of his “multimillion-dollar stake” in Navigator has now been reported, Ross has yet to face any real consequences for his actions, and further investigation into his true ties with Russian officials and the impact that had on American trade and economic relations with Russia have yet to fully be revealed.

When reports of Ross’ under the table involvement with Russian oligarchs went public, he showed anything but humility. He promised to divest his stock, but after finding out a New York Times article was about to publish a story about his connection to Putin he shorted the stock, essentially allowing himself to profit while share prices in Navigator dropped. Not only did Ross not fully own up to conflicts of interest, but he traded on private information and thus potentially violated U.S. trading laws.

Secretary Ross’ conduct demonstrates his irreverent attitude towards both the ethical code of conduct and his role as a cabinet secretary. He snubbed the standard conduct of a Commerce Secretary, who is expected to advocate for the economic well-being of America globally, by putting his financial interests first.

Ross will face questioning from elected officials on a wide range of topics at a Congressional hearing in March, and perhaps then he will be held accountable for his actions. Congress must make it clear that it is no longer acceptable for the official responsible for negotiating America’s commercial interests across the world to be personally invested in certain countries and companies. There must be more congressional oversight on Ross, and, hopefully, the hearing next March will be the first step.

Photo: “Wilbur Ross