This archive report was first published on 17 October 2019.
Elaine Chao's family ties have raised eyebrows in Washington, with the House Oversight and Reform Committee investigating the Secretary of Transportation for possible conflicts of interest involving her family's shipping company, Foremost Group. The New York-based company, owned by Chao's father and sisters, has significant business interests in China.
According to a June 2019 report by The New York Times, the Chao family enjoys an 'extraordinary proximity to power in China for an American family,' marked by board memberships in state companies and multiple meetings with China's former top leader. The Times noted that Chao has repeatedly used her connections and celebrity status in China to boost the profile of Foremost Group.
Chao's first official trip to China as a Trump cabinet officer in 2017 was canceled after ethics concerns were raised about her request to include family members in meetings with Chinese officials. The Transportation Department gave no reason for the cancellation at the time, but an official later said the trip conflicted with a scheduled cabinet meeting.
On September 16, 2019, the oversight committee chairman, Elijah Cummings, and Raja Krishnamoorthi, head of the subcommittee on economic and consumer policy, reminded Chao that federal regulations prohibit using one's public office for 'the private gain of friends, relatives, or persons with whom the employee is affiliated in a nongovernmental capacity.'
The committee is also investigating Chao's failure to divest herself of stock in Vulcan Materials, a producer of construction materials on whose board she served. Chao signed an ethics agreement to sell her holdings by April 2018, but did not do so until June 2019, just days after The Wall Street Journal reported on the matter.
Chao's office has denied any impropriety and said it will turn over information 'on a rolling basis.' A spokesman for the department said, 'These false allegations have been hashed over repeatedly in media reports and answered by the department. They are obviously politically motivated.'
Chao has no official affiliation with or stake in Foremost Group, but she and her husband, Senate Majority Leader Mitch McConnell, have benefited handsomely from her family's good fortunes. In 2008, Chao's father gave her and her husband somewhere between $5 and $25 million, according to disclosure reports. Her extended family has contributed more than $1 million to McConnell's re-election campaigns.
