Ethics Watchdog Raises Alarm on Bessent's Divestment Delays
The U.S. Office of Government Ethics has issued a warning to Treasury Secretary Scott Bessent for failing to fully divest his financial assets as required under government ethics rules. According to a letter dated August 11, sent to Senator Michael D. Crapo, the Republican chairman of the Senate Finance Committee, Bessent has not complied with the ethics agreement he signed in January, which mandated divestiture of certain holdings by April 28. This delay raises significant concerns about potential conflicts of interest as Bessent plays a key role in shaping the economic policies of the current administration.
The ethics office emphasized Bessent's personal responsibility to avoid actions that could create a real or apparent conflict of interest with regard to his holdings. Among the assets in question are soybean and corn farmlands in North Dakota, valued at an estimated $25 million, which are considered a major potential conflict. The office has also advised Treasury ethics officials to reinforce this obligation to the secretary.
Challenges in Divesting Illiquid Assets
Bessent has acknowledged the delays and stated he is working to divest illiquid personal assets, including the farmland, by the end of the year. The complexity of shedding such assets, due to market restrictions and their illiquid nature, has been cited as a primary reason for the delay. Despite modifications to his ethics agreement, key holdings remain undivested, prompting ongoing scrutiny from the ethics watchdog.
Before his confirmation, Bessent had outlined steps to avoid conflicts, including plans to resign from Key Square Group, the macro hedge fund he founded, and to sell his share of the partnership within 90 days of Senate approval. He also disclosed assets worth at least $521 million in his personal financial disclosure. However, the slow progress on divestment continues to cast a shadow over his compliance with federal ethics standards.
Broader Implications for Public Trust
The situation with Bessent's delayed divestitures comes at a time when public trust in government officials is under intense scrutiny. His role as Treasury Secretary involves critical decisions on fiscal policy, tariffs, tax cuts, and deregulation, making the potential for conflicts of interest particularly concerning. The Office of Government Ethics has stressed the importance of adherence to these rules to maintain integrity in policymaking.
Additionally, Bessent recently urged a ban on Congress members trading individual stocks, citing concerns over public trust. This stance contrasts with his own challenges in meeting divestment deadlines, highlighting a broader conversation about ethical standards in government. As the year-end deadline approaches for divesting his remaining assets, the pressure is on for Bessent to resolve these issues and uphold the ethical obligations of his position.