Politics & Government

Elaine Chao investigated by House panel for possible conflicts

The House Oversight and Reform Committee asked Transportation Secretary Elaine Chao on Monday to turn over documents related to communication with her family’s shipping company as the panel stepped up an investigation into whether any actions taken by Chao amount to a conflict of interest.

The request by the committee in the Democratic-controlled House relates to actions Chao has taken that potentially benefited Foremost Group, a New York-based shipping company owned by her family. Foremost has received hundreds of millions of dollars in loan commitments from a bank run by the Chinese government to help build ships that Foremost has purchased from government-owned shipyards there.

The actions by Chao — including joint public appearances since she became transportation secretary in 2017 with her father, James Chao, who founded the company, and a planned trip to China to meet with government officials there along with her father — have led House investigators to question if she is using her office to try to benefit her family’s financial interests.

“Federal regulations prohibit federal employees from using their public offices for the ‘private gain of friends or relatives,’” said the letter sent on Monday to Chao by the House investigators, who cited articles that appeared in The New York Times in June and Politico in 2018 that detailed continued ties between Chao and her family’s company.

The Times investigation found numerous instances in which Chao, as transportation secretary, may have boosted Foremost’s image. In addition to inviting her father to the department in 2017, she also appeared at a signing ceremony that August at the Harvard Club in New York involving Foremost and the Sumitomo Group, a Japanese company with mass transit projects in the United States that fell under her oversight.

Chao has said through a spokesman that she has taken no official action to benefit Foremost. Any appearances with her father — including interviews with Chinese-language reporters at times standing in front of the Transportation Department flag or logo — since she became secretary were just routine family events, the spokesman said.

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