Outside experts who spoke to CNN were shocked that ethics officials at the postal service approved this arrangement, allowing DeJoy to hold at least $ 30 million in XPO holdings.
DeJoy and USPS have said he fully complied with the regulations.
Further alarming, on the same day in June that DeJoy distributed large amounts of Amazon shares, he bought stock options, giving him the right to buy new shares of Amazon at a price much lower than its current market price, according to the revelations.
“Do not pass the odor test”
According to federal data, when he became postmaster general, DeJoy still had a large stake in XPO, totaling between $ 30 million and $ 75 million. Federal ethics officials have endorsed his decision to keep these assets, but outside experts with decades of experience in government are raising red flags.
Schaub, who is now a senior adviser at Citizens for Responsibility and Ethics in Washington, suggested that if DeJoy does not dispose of his property soon, it could be filed as an illegal conflict of interest. Schaub also asked the question why the ethics officials approved this regulation.
“If you have a $ 30 million interest in a business, it will obviously affect you,” said Stuart Gilman, who spent 12 years at the Office of Government Ethics, where he is the assistant director used to be. “I would assume there is a problem here. It certainly does not exist the odor test.”
Democrats call for question
A USPS spokesman previously told CNN that DeJoy complied with all ethical requirements. Federal ethics officials approved DeJoy’s required financial applications in June, July and earlier this month.
“No issues regarding XPO’s postal service contracts have been presented to Postmaster General DeJoy, nor would any such issues be expected to rise to that level,” USPS senior ethics adviser Jessica Brewster-Johnson told CNN. “Decisions regarding XPO contracts are made at much lower levels in the organization. However, if an issue regarding XPO came up for Postmaster General DeJoy, he would be required to decipher himself or, if dismissal was not practicable, the Ethics Bureau would require so far no such problem has arisen. “
The experts who spoke with CNN said that this statement was “sly” and “absurd”, especially since the rules require top officials to even prevent the appearance of a potential conflict.
Federal records also show that DeJoy owned between $ 265,000 and $ 550,000 in UPS stock, but disassembled them after becoming postmaster general in June. Experts praised this move because it eliminated a conflict of interest because UPS is a direct competitor of the postal service.
DeJoy made dozens of shares and purchases around the time he started at USPS. He split at least $ 100,000 in XPO options, but apparently stuck to his larger equity stakes. He also owns options to buy an additional 270,000 shares in XPO, at varying prices in the future. Those options all expire in November.
By the time he took over the USPS, DeJoy was buying and selling shares as stock options across a wide range of industries, including healthcare companies such as Johnson & Johnson and Abbott Laboratories, which were 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 USPS, according to federal records.
Amazon trade
DeJoy’s shares in Amazon shares are also under scrutiny. According to his financial revelations, DeJoy owned between $ 100,000 and $ 250,000 in Amazon stock when he became a member of the administration.
On June 24, DeJoy split those shares, but the same day he bought a new financial stake in the company, buying between $ 50,000 and $ 100,000 in stock options for Amazon. The stock options, which expire on October 16, entitle DeJoy to purchase shares of Amazon at a price of $ 1,960 per share. Shares in Amazon are currently trading at more than $ 3,100.
“It’s another conflict. He has the option to buy. That means he’s gambling that Amazon’s value is going to go up,” said Marcus Owens, a former top IRS official with decades of experience dealing with federal ethical rules. . “Why is he investing in a competitor for the company he manages to manage? This is a classic case for investigation by an inspector general.”
“This is pretty outrageous, to get into government and then buy into conflicting (interests),” Shaub said. “He eliminated a conflict of interest in part and then bought a new one the same day.”
As recently as last week, Trump called Amazon by name while criticizing USPS price points.
The USPS claims that DeJoy’s ownership of the XPO stake, and of these other assets, is not problematic on its own. USPS officials also say that their new leader is not trying to sabotage the 2020 election with postal delays, and that he is following all appropriate ethical rules.
“I take my ethical obligations seriously, and I have done what is necessary to ensure that I am and will remain in compliance with those obligations,” DeJoy said in a statement to CNN.
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