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Congressman calls for ethics probe of his advocacy for defense contractor

Rep. Tom Petri, R-Wis., advocated for Oshkosh Corp. while owning stock

Feb. 17, 2014 - 08:50PM   |  
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WASHINGTON — Rep. Tom Petri says he is “distressed by the innuendo” that there is a conflict between his personal financial interests and his official actions in Washington so he took the unusual step on Sunday of asking the House Ethics Committee to investigate.

“To end any questions, I am requesting that the committee formally review the matter and report back,” the Wisconsin Republican wrote in a letter to the committee that his office released Monday.

His move follows a Gannett Washington Bureau investigation of his advocacy at the Pentagon and on Capitol Hill for Oshkosh Corp., a defense contractor in his district, while he owned hundreds of thousands of dollars worth of stock in the company. His stock increased in value by 30 percent while he championed Oshkosh’s interests.

That report prompted nonpartisan watchdog group Public Citizen last week to urge the independent Office of Congressional Ethics to review the case, saying Petri had an “obvious conflict of interest.”

A spokesman for Petri, who has repeatedly declined to be interviewed on the subject, did not immediately return a message seeking comment Monday. In his letter, the congressman took issue with the Gannett report, although he did not dispute its accuracy.

“Articles (enclosed) recently questioned my ownership of stock in companies and my actions on their behalf,” Petri said in the letter. “It is my honor and duty to advocate on behalf of those who live and work in my area; I am distressed by the innuendo in these articles.”

Petri’s letter was not directed at the independent OCE but rather to colleagues on the House Ethics Committee, Chairman Rep. Mike Conaway, R-Texas, and Ranking Member Rep. Linda Sanchez, D-Calif.

House ethics rules prohibit members from using their official position for personal gain, but they are murky and are interpreted on a case-by-case basis by the House Ethics Committee, which is responsible for enforcing them.

The independent Office of Congressional Ethics typically conducts preliminary reviews and if warranted, refers cases to the committee for further action.

Officials at the Office of Congressional Ethics and the House Committee on Ethics could not be reached for comment Monday because they were closed for Presidents Day.

Ethics watchdogs have said Petri’s situation deserves scrutiny because he contacted executive branch agencies — in this case the Defense secretary and secretary of the Army — in 2009 in an attempt to preserve and expedite the awarding of a $3 billion truck-manufacturing contract to Oshkosh.

In addition, he wrote colleagues in Congress asking them to reject $101 million worth of cuts the Pentagon wanted to make to its budget for the trucks in 2013. His House colleagues blocked $80 million worth of cuts.

At the same time, Petri’s investments of $265,000 to $650,000 in Oshkosh stock grew in value to between $340,000 and $863,000, a gain of 28 percent to 33 percent, a Gannett Washington Bureau analysis found.

Petri said in his letter than he disclosed his investments as required in annual financial disclosure reports and that he sought guidance from the Ethics Committee “from time to time” regarding his advocacy for the company. He said he did not act on inside information.

“My actions as a stockholder are no different than any other stockholder based solely on public information,” he wrote.

Craig Holman, the senior legislative director for Washington-based Public Citizen who urged last week that the OCE investigate Petri, said Petri’s request for the probe is unusual but not unprecedented.

“It seems like a wise strategy, especially for the public image of it all,” Holman said in an interview. “But the one other time that I know it’s happened, it did backfire.”

New York Democratic Rep. Charles Rangel asked the committee to investigate after the New York Times reported in 2008 that he was improperly paying below-market rent on apartments in New York City and the Washington Post reported that he was raising money from companies with business before the congressional committee he chaired.

The committee ended up finding Rangel had violated House rules, and the House voted to censure him for failure to pay income taxes and misuse of his office to solicit fundraising donations, among other reasons.

In Petri’s case, Holman said the congressman “should have been aware of the conflict of interest situation he’s put himself in the middle of.”

“We just had a battle over the STOCK Act not long ago,” Holman said referring to the 2012 law prohibiting insider trading by members of Congress. “And so he should have been aware as to how sensitive and bad this looks.”

One Washington defense lawyer who previously conducted investigations for the Ethics Committee said lawmakers who ask for probes themselves may believe one is imminent or already in the works and so want to be seen as proactive.

“It’s intended to inoculate the member from the additional political sting of their coming under an ethics investigation as a result of a complaint filed by someone else or the committee undertaking an investigation on its own,” said David H. Laufman, who has also represented clients in ethics probes.

Since Gannett published the Petri report, reaction has been fervent on both sides of the political spectrum. Robert Naiman, policy director for progressive Just Foreign Policy, started a petition calling for an investigation by the Office of Congressional Ethics and the House Ethics Committee.

“A mainstream media report that has not been contradicted is sufficient evidence to justify a preliminary investigation,” states the petition, which has garnered nearly 17,000 signatures since it was created last week. Some 650 Wisconsinites have signed on.

Meanwhile, Collin Roth, associate editor of Charlie Sykes’ conservative Right Wisconsin wondered Monday if the ethical cloud hanging over Petri would prompt a Republican primary of the 17-term incumbent.

“For the 73-year-old congressman, an ugly congressional ethics investigation may be enough to convince Petri to hang it up,” Roth wrote. “But if not, the presence of an investigation provides a perfect opportunity for a conservative primary challenger.”

Roth floated potential challengers such as Joe Dean, founder of Stars and Stripes Honor Flight in Wisconsin, which brings veterans to visit the World War II Memorial in Washington, D.C. And he said state Sen. Glenn Grothman and former Scott Walker adviser John Hiller are exploring primary challenges against Petri.

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