Government Watchdog Files Ethics Complaint Against Rep. Devin Nunes for Lying About His Investments in Several California Companies
FOR IMMEDIATE RELEASE: July 11, 2018
Contact: Daniel Stevens, firstname.lastname@example.org, 202.780.5750
WASHINGTON, D.C. – Today, Campaign for Accountability (“CfA”), a government watchdog group focused on public accountability, called on the Office of Congressional Ethics (“OCE”) to investigate whether Rep. Devin Nunes (R-CA) violated federal law and House rules by failing to accurately disclose his investments in three California companies on his personal financial disclosures (“PFDs”).
CfA Executive Director Daniel E. Stevens said, “Devin Nunes has a deplorable ethics record. Not only has he leaked confidential information, but now it seems he failed to accurately disclose his investments in several California companies. The OCE should investigate immediately.”
Rep. Nunes appears to have inaccurately disclosed his investments in Alpha & Omega Winery LLC, its sister winery, Phase 2 Cellars LLC, and Vidonia LLC. First, Rep. Nunes purchased a stake in Alpha & Omega in February 2006 for between $50,001 and $100,000. Despite the winery’s growth and success, Rep. Nunes declared no income from his investment until 2013 and even then, less than $5,000 a year.
In 2015 Rep. Nunes bought shares of Phase 2 Cellars. The winery’s subscription agreement reveals that shareholders were required to invest a minimum of $200,000, yet Rep. Nunes’ PFD reports an investment of only between $50,001 and $100,000. If Rep. Nunes was allowed to invest less than others because of his position, he may have received a gift in violation of House rules, and, if he actually invested $200,000 he may have willfully violated disclosure rules for undervaluing the investment.
There are also questions as to how Rep. Nunes financed the transaction. At the time of the investment, his PFDS reflect limited income, making it unclear how he could afford the investment.
Finally, nowhere on any of his PFDs does Rep. Nunes list ownership of and investment in Vidonia LLC, a California financial holding company active between 2006 and 2009. Nevertheless, a Form D filed by Vidonia with the SEC in 2007 reveals that Rep. Nunes and his wife were listed as beneficial owners of the company, along with other couples who are members of Rep. Nunes’ extended family or dairy farmers. The filing indicates Vidonia had an aggregate value of $1 million, and the minimum investment for ownership (per couple) was $125,000. Notably, if each of the nine couples had, in fact, invested $125,000, the aggregate value should have been $1,125,000, suggesting one of the named couples may not have paid the $125,000.
If someone else paid Rep. Nunes’ portion of the Vidonia investment, he may have received an impermissible gift that he failed to report. This also begs the question of why – if Rep. Nunes did not use his own money to invest in Vidonia – did other investors cover the purchase price for him and what did they receive or expect to receive in exchange?
Stevens continued, “While one error on a PFD can be an accident, discrepancies across several years are likely intentional. While unethical conduct by any member of Congress is problematic, it’s even worse for the chair of the House Intelligence Committee, who conducts investigations in which witnesses are expected to testify truthfully and can be prosecuted for failing to do so. What’s good for the goose is good for the gander. If he lied on his PFDs, Rep. Nunes should be held accountable.”
Campaign for Accountability is a nonpartisan, nonprofit watchdog organization that uses research, litigation, and aggressive communications to expose misconduct and malfeasance in public life and hold those who act at the expense of the public good accountable for their actions.