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‘Appearance’ Isn’t Enough for Ethics Panel in Graves Case

Although one body of Congressional overseers found the appearance of a conflict of interest, the House ethics committee on Thursday dismissed an ethics complaint against Rep. Sam Graves (R-Mo.) because his action — inviting a business associate of his wife to testify before the Small Business Committee — did not violate any specific House rules.The independent Office of Congressional Ethics, which referred the matter to the ethics committee — formally known as the Committee on Standards of Official Conduct — had concluded Graves probably violated the chamber’s code of conduct, but the House ethics panel unanimously and strenuously objected that no House rule governed Graves’ behavior.The investigation stemmed from a March 4 Small Business Committee hearing on renewable fuels. Graves, the ranking member on the committee, invited Brooks Hurst to testify as a representative of the Missouri Soybean Association.Hurst is one of Graves’ closest friends, and Graves had invited him to testify on renewable fuels once before, in 2004. Roll Call reported in 2007 that Graves failed to disclose that his wife was an investor in an ethanol plant discussed at the hearing and that Hurst later recruited the Congressman’s family to invest in a biodeisel plant in the state.After Roll Call’s story in 2007, Graves told the Kansas City Star that he “probably should have— disclosed the relationship between Hurst and his family.But at the hearing in March, neither Graves nor Hurst made any mention of their relationship or their mutual financial interests.The 541-page report released by the ethics panel — which includes the investigative report assembled by the OCE — chronicles a tense dispute over whether Graves’ actions actually violated any rules.The OCE, in its report to the House ethics committee, unanimously concluded “there is substantial reason to believe that Representative Graves’ invitation to [Hurst] to testify before the Committee on Small Business on a matter that related to both [Hurst’s] and his own financial interests created an appearance of a conflict of interest.—The OCE argues that given the earlier news stories, Graves clearly knew of his financial connections to Hurst. The investigative report includes e-mails from staff indicating that inviting Hurst to testify in March was Graves’ idea, though staff members had cautioned against inviting anyone from companies in which Graves has investments.But House ethics panel concluded that “no relevant House rule or other standard of conduct prohibits the creation of an appearance of a conflict of interest when selecting witnesses for a committee hearing,— and the hearing did not result in any action that could have benefitted Graves or Hurst.According to the committee’s report, the Small Business Committee’s rules for witnesses require only that they disclose any federal grants or contracts that they may have, not their personal investments, so it is possible that Graves would not have known about Hurst’s investments. Graves told the OCE investigators that he did not know about Hurst’s investments and that he and Hurst didn’t discuss them, despite being long-time friends.In addition, the criteria that Republican staff established for inviting witnesses to testify only ruled out witnesses who were employees of companies that Graves was invested in. Hurst was a fellow investor, not an employee.Graves’ attorney, Elliot Berke, pointed out to the panel in an Oct. 5 memo that the hearing provided no financial benefit to Graves or Hurst because “the Committee on Small Business has no financial oversight whatsoever and it can take no legislative action to financially affect renewable or biofuel companies.—The OCE report includes notes from an interview with Graves in which he said the Small Business Committee holds “feel-good hearings— that have no effect other than generating press coverage. “When you bring a witness in, you want them to feel important, but in many cases their testimony is meaningless because the committee has no jurisdiction,— Graves told the OCE investigators. “You don’t tell people that, that their testimony won’t have an impact.—Berke’s memo included a plea to ethics committee not to publicly release the OCE report on Graves.Berke argued that the OCE investigation was deeply flawed and based on a misunderstanding of House rules, and releasing its report would be unfair to Graves. For example, Berke argued, the interview excerpts “are essentially witness summaries prepared by the OCE staff. These memoranda do not reflect the full transcripts of interviews … placing such summaries into the public domain would not respect the full and complete testimonies of the witnesses, nor the context in which such testimonies were given.—In addition Berke told the House ethics committee that the report is based on “inaccurate findings of fact— that “amount to innuendo, speculative assertions, and factually erroneous conclusory statements that the Ethic Committee has long recognized the dangers of including in there investigative process.—

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