Joe Biden

Energy Secretary Jennifer Granholm Violated a Stock Disclosure Law Nine Times Last Year

Evelyn Hockstein | Reuters
  • Energy Secretary Jennifer Granholm sold shares of stock nine times last year and did not disclose the sales within the legally required 45-day window, according to federal disclosure documents.
  • The sales ranged from April to late October, but Granholm did not disclose any of them until mid-December, after the deadlines had passed.
  • A spokeswoman for Granholm said that the late disclosures were the fault of a "clerical error" and that the secretary had paid a late filing fee.

WASHINGTON — Energy Secretary Jennifer Granholm violated the STOCK Act at least nine times last year, by selling shares of stock worth up to $240,000 and failing to disclose those sales within the 45-day window that the 2012 law requires.

The dates of Granholm's stock sales ranged from April to late October, according to federal disclosure documents first reported by Business Insider. But Granholm did not disclose any of them until mid-December, which was in some cases a full six months after the deadline to report the sale had passed.

Granholm filed her two disclosures on Dec. 15 and Dec. 16, revealing nine stock sales in total, some of which dated back as far as April of last year.

The transactions included shares of real estate website Redfin worth between $16,000 and $75,000, according to Granholm's disclosures.

She also sold shares in ride-hailing company Uber worth up to $50,000, and financial services giant Invesco, also worth up to $50,000.

The STOCK Act expanded the accountability and reporting requirements for financial holdings, both for members of Congress and high-level employees of the executive branch like Granholm.

The standard transaction forms like those that Granholm filed specifically say that stock transactions must be reported no later than 45 days after the transaction itself. However, the form also says that filers must disclose their transactions within 30 days of "receiving notification" of them.

Granholm checked a box on her December forms claiming it had been less than 30 days since she had been notified of the transactions. So it appeared as though she was in compliance with one part of the form, but in violation of the actual deadline itself.

Public figures and elected officials often turn over the management of their portfolios to outside advisors who make their buying and selling decisions for them. Still, claiming not to have known about a stock transaction is not a valid justification for violating the STOCK Act.

"This was an inadvertent clerical oversight on reporting stock sales that ethics officials previously determined did not pose a conflict in her role as Energy Secretary and the Secretary paid the late filing fee," said Department of Energy spokeswoman Charisma Troiano, in response to questions Thursday from CNBC. "The Secretary remains focused on delivering an equitable clean energy future that will bring cheaper power, cleaner air and more good-paying jobs for more Americans."

Having paid the late filing fee, "The Department of Energy's ethics office has certified that based on her reports, Secretary Granholm's financial holdings are in compliance with the law," said Troiano.

Nonetheless, it is surprising that Granholm was only notified about these stock sales in late November or December, according to her disclosure form, given that Granholm was selling other stocks during the same period of time in order to eliminate any potential conflicts of interest.

When President Joe Biden nominated her to be his energy secretary, Granholm signed a detailed ethics agreement in which she agreed to give up part-time jobs at the University of California and at CNN, step down from several boards, and sell millions of dollars worth of stock.

On March 22, she reported 23 stock sales, many of them blue chip companies she had more than $10,000 of shares in.

A few months later in May, Granholm filed more transaction reports detailing how she had exercised stock options in electric bus and battery company Proterra and then sold all her shares, worth between $1 million and $5 million, on May 24.

But in between the March blue chip sales and the May Proterra sale, Granholm made six of the nine stock sales that didn't get disclosed until December.

The news of Granholm's apparent violations comes at time when stock sales by public officials and members of Congress are getting a fresh look.

During the past week, several members of Congress, both Democrats and Republicans, have introduced or reintroduced legislation that would effectively ban lawmakers and their immediate family members from actively trading stocks while the member is in office.

Last year alone, a total of 54 members of Congress violated the STOCK Act rules, according to an analysis by Business Insider's Dave Levinthal published earlier this month.

There are growing signs that the public supports a ban, too. A recent survey commissioned by a conservative advocacy group found that 76% of voters believed that lawmakers and their spouses had an "unfair advantage" in the stock market.

The same survey, conducted by the Convention of States Action, also found that just 5% of likely voters approved of members of Congress trading stocks.

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