Elaine Chao Canceled ‘Inappropriate’ China Meeting to Boost Family Biz After State Dept. Alarms

Transportation Secretary Elaine Chao repeatedly used her “connections” to boost her family’s shipping company in China, with “inappropriate requests” raising alarms at the State Department, The New York Times reports.

Chao requested to hold “alarmingly inappropriate” meetings between her family’s company and Chinese government officials, according to emails obtained by The Times.

In October 2017, Chao asked federal officials to arrange travel to China for at least one of her family members to have them included in meetings which Chinese officials.

“She had these relatives who were fairly wealthy and connected to the shipping industry,” a State Department official told The Times. “Their business interests were potentially affected by meetings.”

The trip was canceled after ethics concerns were raised at the State and Transportation Departments.

Chao has no formal role in the company, the Foremost Group, but she and her husband, Senate Majority Leader Mitch McConnell, have received millions in gifts from her father, who ran the company until 2018.

Foremost has received hundreds of millions in loans commitments from a Chinese government-run bank.

Chao made money from stock she vowed to sell:

The Times report comes after The Wall Street Journal reported that Chao continues to make money from stocks he vowed to sell a year earlier.

According to the Journal, Chao agreed to divest from the company Vulcan Materials, but has held on to her shares, which gained more than $40,000 over that time.

Chao said in an ethics agreement she would not "participate personally and substantially in any particular matter in which I know that I have a financial interest” and said she would resign from the company and sell her stock in 2018.

Chao had agreed to receive a “cash payout” after resigning from the company but was instead compensated in stock that she continued to hold.

Former Office of Government Ethics Chief Walter Shaub told The Journal that the issue was likely no a legal conflict of interest but, "for the head of the DOT to have a financial interest in an asphalt company, that is not sending a message to employees of DOT that she is making ethics a priority."

Chao held meetings at her husband’s request:

Both reports come just months after Politico reported that Chao has met with political leaders and officials from Kentucky at least 10 times at her husband’s request.

Some meetings led to positive outcomes for the businessmen and politicians McConnell arranged for her wife to meet.

“This is the kind of stuff the American public hates,” Caroline Ciccone, the executive director of Restore Public Trust, told Politico. She added that a “prudent elected official” would avoid favoritism “not just because it looks bad, it’s because it is bad.”


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