September 28, 2016 | No Comments
Ending a long-running dispute, the House Ethics Committee disciplined Rep. Dave McKinley (R-W.Va.) on Wednesday for failing to change the name of his former firm once he was elected to Congress in 2010.
The formal “letter of reproval” issued to McKinley over the violation of House rules and the Ethics in Government Act (EIGA) is the mildest punishment that the secretive panel can mete out. Practically speaking, it amounts to little more than a slap on the wrist.
Yet it still could prove a political embarrassment to the West Virginia lawmaker, who has long denied any wrongdoing in the matter. The Ethics Committee said McKinley had not cooperated with its investigation for several years, and complained that he had mistakenly followed the advice of an attorney who had no experience in federal ethics law.
In his own statement, McKinley said he had received “conflicting guidance” from Ethics Committee staffers on the issue, adding that he didn’t believe the panel could actually issue a letter of reproval as a punishment.
Despite that, though, McKinley said he accepted the committee’s decision.
“After receiving conflicting guidance from the staff of the Ethics Committee, my attorney concluded that I had two options — change the name or sell the company. We chose the latter,” McKinley said. “Unfortunately, the advice of my former attorney was incorrect. Months later, the Committee insisted that the name would also need to be changed, but the new owners were unwilling to change the name.”
McKinley added: “After nearly six years of back and forth with the Committee on Ethics, this matter is now resolved. I have cooperated with the Committee throughout this inquiry. Even though a ‘reproval’ is not a sanction under the Committee’s rules, I do not agree with the Committee’s conclusion that my actions warrant a letter of reproval. I do not agree with many of the statements and findings in the Committee’s letter and report. … [But] I accept that the Committee’s release of a letter and report resolves this issue. It is time to focus on continuing the work the people of the First District elected me to do.”
The McKinley case goes back to 2010, when McKinley, an engineer and former state lawmaker, was elected to Congress.
In 1981, McKinley had founded an engineering and architectural firm called McKinley & Associates.
After he won his House seat, McKinley was told by the Ethics Committee that under longstanding federal law and House rules, he was required to change the firm’s name.
Instead, according to the Ethics Committee, “Representative McKinley ceased communicating with the Committee and sold his shares in the Firm to the Firm’s Employee Stock Option Plan (ESOP), with the Firm’s name intact.” The ESOP bought the shares with a $3 million-plus loan from McKinley.
The Ethics Committee report said, “Following its investigation, the Committee concluded that Representative McKinley’s decision to sell the Firm, with the name intact, violated EIGA and the House rules, even though Representative McKinley relied on the advice of his attorney when making that decision. Therefore the Committee voted to issue this Report, along with a Letter of Reproval to Representative McKinley for his conduct.”
McKinley had argued that his father had an engineering firm with the same name, and under the “family name” exception to EIGA and House rules, he wouldn’t have to change his company’s name.
The Ethics Committee, however, rejected that position, saying they were two “distinctly” different companies.