Energy Department Allowed Hundreds Of Employees With Stock In Related Companies To Keep Shares: REPORT

Energy Department Allowed Hundreds Of Employees With Stock In Related Companies To Keep Shares: REPORT

Katelynn Richardson on February 22, 2023

One-third of senior leaders in the Energy Department were warned about owning stock in energy-related companies or having family members who own stock, yet many held onto their shares because they were not required to sell, according to a Wall Street Journal analysis of 2017-2021 financial disclosures.

U.S. law prohibits federal employees from participating “personally and substantially” in any matter in which they have a financial interest. But the Energy Department’s ethics policy, unlike other agencies, doesn’t explicitly instruct officials to sell their stocks unless ethics lawyers “believe the official wields substantial influence over policies,” the WSJ reported.

Over 300 agency officials received warnings from department ethics lawyers about a potential conflict-of-interest for owning stocks in a company the department oversees or has provided with grants, contracts, or loans. The warning letters lawyers gave officials only said to “remain alert” for conflicts and to avoid working on anything that could “have a direct and predictable effect” on their investment, and officials holding such stocks are still certified as compliant under U.S. law, the WSJ reported.

Of the 300 officials warned, the WSJ reports six dozen owned stocks in “major energy companies” like Exxon Mobil Corp. Last fall, the outlet reported more than 2,600 government officials in 50 federal agencies held investments in companies related to the work of their agency.

One official cited by the WSJ, Philseok Kim, who directs an Energy Department division that funds research on emerging energy technologies, reported owning investments in Tesla Inc. at the same time his division was funding research to expand the U.S. electric-vehicle battery supply chain and to create longer-lasting batteries.

Another official, Paul Golan, previously an Energy Department overseer of two federal research labs, reported 130 trades in 18 companies related to the department’s work, continuing to report trades in Chevron for years after he was sent a letter by ethics lawyers. In 2020, he reportedly made six trades in the company between $50,001 and $100,000.

In a statement to the Daily Caller News Foundation, the Energy Department said that it maintains “strong firewalls to reduce conflicts between employees and outside entities.”

“DOE’s vast RD&D portfolio supports advances in a broad set of technologies, including energy, health care, computing and so much more,” the department told the DCNF. “The Department works diligently to ensure staff is aware of and following the letter and spirit of ethics laws and regulations to ensure the American people have the upmost confidence their government is working for them. In instances where ethics conflicts are identified, the Office of the General Counsel works closely with the employee, their management, and the Office of Government Ethics to address the conflict in accordance with all statutory and regulatory requirements. “