President Trump’s penchant for nominating millionaires and billionaires with extensive financial holdings for top administrative positions – and announcing their nominations before vetting for financial conflicts of interest–has led to several prominent withdrawals due to conflict of interest and ethical concerns.
On February 3, Vincent Viola, nominated to be Secretary of the Army, withdrew from consideration for the position.[i] To comply with the Department of Defense’s ethics rules, Mr. Viola, would have had to separate himself financially from the multiple companies he owns. For Mr. Viola, a Forbes 400 billionaire and owner or majority shareholder of such organizations as the Florida Panthers, Virtu Financial, and Eastern Airlines, the financial sacrifice proved to be too high.[ii] Before he withdrew, Mr. Viola also faced ethical scrutiny over benefits he would receive for federal contracts and potentially unethical trading practices.[iii]
On February 15, Andrew Puzder withdrew from his nomination to be Secretary of Labor.[iv] Though the withdrawal was apparently catalyzed by Mr. Puzder’s prior employment of an undocumented housekeeper and allegations of domestic abuse,[v] his nomination had already been stalled for weeks due to ethical issues with his finances.[vi] Mr. Puzder’s confirmation hearing was delayed four times because of the difficulty of disentangling Mr. Puzder from his extensive holdings,[vii] primarily the privately-owned CKE Restaurants Inc., which includes franchised restaurants such as Hardee’s and Carl’s Jr. Even under the ethics plan the Office of Government Ethics eventually approved, he would have retained an alarming ability to benefit from his companies, including opportunities to influence Department of Labor investigations at CKE franchise-owned stores and to promote policy decisions favorable to fast food restaurants in general.[viii] Moreover, unnamed underlying assets in Mr. Puzder’s investment funds, which Mr. Puzder refused to disclose, likely would have raised further conflict of interest concerns.[ix]
On February 26, Philip Bilden, President Trump’s nominee for Navy Secretary, withdrew his name from consideration.[x] Like Mr. Viola, Mr. Bilden decided that the hit his finances would suffer if he complied with federal conflict of interest rules was too high a price to pay, even for a top position in the Pentagon. Mr. Bilden, recently retired from twenty-five years at a private equity firm he co-founded, explained that the ethics requirements would be too disruptive given his family’s private financial interests.[xi]
Most recently, Todd Ricketts, who President Trump had nominated for Deputy Commerce Secretary, withdrew his name from consideration due to the difficulty of complying with the ethics requirements.[xii] In addition to holding a wide variety of financial interests, Mr. Ricketts is a board member of the Chicago Cubs.
Those familiar with presidential transitions and the appointments process have voiced concern that the Trump administration failed to vet candidates for financial conflicts of interest before officially nominating them. The resulting withdrawals not only reveal the wisdom of the customary vetting process, but also underline the Trump administration’s cavalier attitude towards conflicts of interest.
[i] Susanne Craig, Vincent Viola, Nominee for Army Secretary, Drops Out, New York Times, Feb. 3, 2017, available at
[ii] Id.; Scott Horsley, The Richest Administration In History Just Got Richer, NPR, Dec. 20, 2016, available at http://www.npr.org/2016/12/20/506210163/the-richest-administration-in-history-just-got-richer.
[iii] Patrick Reilly, Why Vincent Viola turned down Trump’s nomination for Army Secretary, Christian Science Monitor, Feb. 4, 2017, available at
http://www.csmonitor.com/USA/Politics/2017/0204/Why-Vincent-Viola-turned-down-Trump-s-nomination-for-Army-Secretary; Craig, New York Times, Feb. 3, 2017.
[iv] Ed O’Keefe and Jonnelle Marte, Andrew Puzder withdraws labor nomination, throwing White House into more turmoil, Washington Post, Feb. 15, 2017, available at https://www.washingtonpost.com/powerpost/now-6-republicans-are-on-the-fence-about-andrew-puzder/2017/02/15/e34cada6-f38b-11e6-8d72-263470bf0401_story.html.
[v] Marianne Levine, Puzder addresses abuse allegations, Politico, Mar. 9, 2017, available at http://www.politico.com/story/2017/03/andrew-puzder-labor-abuse-allegations-235895.
[vii] Jonnelle Marte, Labor Nominee Puzder’s Confirmation Hearing Delayed a Fourth Time, Washington Post, Jan. 31, 2017, available at https://www.washingtonpost.com/news/get-there/wp/2017/01/31/labor-nominee-puzders-confirmation-hearing-delayed-a-fourth-time/?utm_term=.f93cf67f4a39.
[viii] Ben Penn, Puzder Ethics Plan Permits a Pro-Restaurant Labor Department, Bloomberg BNA, Feb. 10, 2017, available at https://www.bna.com/puzder-ethics-plan-n57982083611/.
[ix] Id.; Ralph Ellis, Navy Secretary Nominee Philip Bilden Withdraws, CNN, Feb. 26, 2017, available at http://www.cnn.com/2017/02/26/politics/navy-secretary-nominee-bilden-withdraws/.
[x] Scott Shane, Philip Bilden, Nominee for Secretary of the Navy, Withdraws, New York Times, Feb. 26, 2017, available at https://www.nytimes.com/2017/02/26/us/politics/philip-bilden-nominee-secretary-navy-withdraws.html.
[xii] Lynn Sweet, Cubs’ Todd Ricketts withdraws name for Trump’s Cabinet, Chicago Sun-Times, Apr. 19, 2017, available at http://chicago.suntimes.com/politics/cubs-todd-ricketts-withdraws-name-for-trumps-cabinet/.