The House Ethics Committee has released detailed reports on four members — three Republicans and one Democrat — who face allegations of ethics rules violations, all pertaining to financial disparities ranging from improper use of campaign funds to failure to disclose stock trades.
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The Office of Congressional Ethics (OCE), an independent body that reviews ethical complaints and makes recommendations to the House Ethics Committee, investigated Republican Reps. Mike Kelly (Pa.), Alex Mooney (W.Va.), and Jim Hagedorn (Minn.), as well as Democratic Rep. Tom Malinowski (N.J.).
The House Ethics Committee will review all four cases, the reports of which were released Thursday. The committee said “the mere fact of conducting further review of a referral, and any mandatory disclosure of such further review, does not itself indicate that any violation has occurred, or reflect any judgment on behalf of the committee.”
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The OCE found that Kelly, a six-term congressman, may have inappropriately used information he received during his official job duties for personal gain. According to the report, there is “substantial reason to believe” that Kelly’s wife, Victoria, purchased stock in steel company Cleveland-Cliffs based upon confidential information that the lawmaker received.
Cleveland-Cliffs, an Ohio-based company, had, in early 2020, threatened to close its operations in Butler, Pa., which is part of Kelly’s district, unless the U.S. government intervened and extended trade protections to the company. The Butler plant employs approximately 1,400 of Kelly’s constituents.
Kelly, along with other Pennsylvania and Ohio lawmakers, rushed to lobby the Trump administration, including then-White House chief of staff Mark Meadows, to grant such additional protections to Cleveland-Cliffs. On April 28, 2020, the Commerce Department agreed to take action in support of the Butler plant, with then-Commerce Secretary Wilbur Ross calling the Cleveland-Cliffs CEO that day to inform him that his company would potentially benefit from the move. Because of this decision, Cleveland-Cliffs decided against closing the Butler plant.
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According to the OCE report, Kelly’s office was told about these developments that day. The next day, Victoria Kelly purchased between $15,001 and $50,000 in Cleveland-Cliffs stock, an “anomalous” purchase, according to the report, because, a year earlier, she had liquidated all her individual stock. The Cleveland-Cliffs purchase was Victoria Kelly’s first individual stock purchase in almost a year. Victoria Kelly bought the stock for $4.70 a share. By the time she sold it, in January 2021, it had gone up to $18.11 a share.
“The timing of this stock purchase suggests that it may have been made based on nonpublic information that Victoria Kelly learned from her husband,” the report alleges.
In September 2020, a spokesman for the lawmaker said Victoria Kelly bought the stocks “to show her support for the workers and management of this 100-year old bedrock of their hometown.” The OCE, however, noted that neither Rep. Kelly nor his wife made a public announcement of the stock purchase.
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The lawmaker and his wife refused to cooperate with the OCE investigation. The watchdog, however, did receive third-party information concerning the stock purchase through witness interviews and emails.
In a letter, Kelly’s lawyer said the OCE extensively investigated for three months, “yet its report is noticeably devoid of any evidence of misconduct.” The lawyer, Thomas W. King III, said, “We look forward to working with staff to resolve the matter quickly.”
A spokesman for Kelly did not immediately respond to The Washington Post for additional comment on Friday.
In the report on Mooney, the OCE found that the three-term West Virginia Republican probably used campaign funds for personal purchases, mainly for “small-dollar meal expenses and in-district travel.” The OCE noted that Mooney did cooperate in the investigation and passed remedial measures to correct the violations and prevent future mistakes.
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It was Mooney’s penchant for fast-food meals that raised eyebrows at the ethics office. Mooney’s FEC filings, the report states, indicate a pattern of day-to-day meal expenditures at places like Chick-fil-A, Panera, Taco Bell and local pizza joints. Mooney’s office provided explanations for the meals, including a $12.84 purchase at Wingstop that the lawmaker’s staff attributed to a trip Mooney made to the post office to pick up campaign mail. He stopped at the chicken wings chain for lunch on the way home. In his interview with investigators, Mooney said he felt justified in charging meals to the campaign any time there were constituents at the location he happened to eat at that day.
Mooney was also accused of spending campaign dollars on trips to West Virginia that his office labeled “site visits” but that investigators found to be “primarily personal in nature.” This includes a nearly $2,500 trip to a resort and a $302 private fishing tour. Mooney’s office did not immediately respond to a request for comment on these accusations, but in a statement to C-SPAN, Mooney said the OCE report shows that the majority of the “politically motivated allegations against me were found to lack merit.”
In Malinowski’s case, the OCE found that the New Jersey Democrat did not file reports for stock trades made in 2019 and 2020. Malinowski has already admitted to the misstep, saying the failure to report the transactions was “carelessness on my part” that he regretted and took responsibility for.
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A spokeswoman for Malinowski told The Washington Post that the OCE report confirms that Malinowski’s stock transactions were “made solely by his broker, based on publicly available information,” and without the lawmaker’s knowledge or input. The congressman, she said, has “fully corrected” the issue.
“Congressman Malinowski has since gone far beyond what the law requires by placing his holdings in an Ethics Committee approved qualified blind trust,” the spokeswoman said.
In Hagedorn’s case, the OCE found that the two-term Minnesota Republican improperly awarded contracts to firms connected to two of his aides. Per the report, Hagedorn hired the companies to handle mailing and design services and was charged unusually high prices. The purchases totaled nearly half a million dollars in campaign funds. The issue first raised alarm in June 2020, when LegiStorm reported the anomaly. Hagedorn fired his chief of staff upon the news and commissioned a review of the contracts. The OCE said it had enough evidence to show that Hagedorn “knew or should have known” that he was being overcharged for the mailing services.
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The OCE also found that Hagedorn received campaign office space from a political donor at below market value. The watchdog found that Hagedorn also knowingly made false statements to the public about the use of that office space when confronted with the allegations.
In a statement to The Washington Post, an attorney for Hagedorn said the representative “acted in a responsible and transparent manner” the moment he heard of the mail company issues in his office.
“He had no knowledge of the underlying issues and has acted in good faith throughout,” the attorney said.