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Financial Disclosure Reports Show 25% Error Rate

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Rep. Brian Bilbray has already submitted four amendments to the financial disclosure form he filed last year, and he is working on a fifth amendment. The various forms show wildly disparate valuations of his wife’s tax services business.

Members of Congress are required to disclose their personal finances by the beginning of next week, but if past efforts are any indicator, about a quarter of lawmakers will probably file inaccurate disclosure forms.

Members of Congress and certain senior-level staffers are required by federal law to file the annual report due Monday in order to provide a public window into lawmakers income, investments and liabilities. But the initial information provided by Members is frequently wrong. A Roll Call analysis of filings with the Clerk of the House shows that three out of 10 House Members filed amendments to prior disclosures last year. In the Senate, more than 12 percent of all filings last year were amending prior incorrect submissions, according to data gathered by CQ MoneyLine.

Lying on disclosure forms is a crime, but there is essentially no penalty for simply getting them wrong.

Requirements to report details about real estate holdings, self-directed investment accounts and capital gains from the sale of property or stocks frequently trip up lawmakers.

Though the House Ethics Committee revised and expanded its instruction manual this year to address these issues, many Members submit forms with omissions, typos or mathematical errors that can swing their apparent net worth by millions of dollars.

For example, Rep. Brian Bilbray has corrected the disclosure he filed last year four times and is working on another amendment. The issue is a family tax consulting business, which has a reported value swinging from as little as $15,000 to as much as $50 million, depending on the version of the form.

In his initial disclosure, the California Republican reported that his wife earned $52,000 from a tax business valued at 
$25 million to $50 million. In his first amendment filed to include previously omitted capital gains from the sale of a property in Montana after Roll Call contacted him Bilbray reduced the valuation of the tax business to $15,001 to $50,000. In subsequent filings in June and July of last year, the value of Bilbray Tax Service vacillates between the two figures. A representative from Bilbrays office said a new amendment is in the mail that will correctly note the value of the business as $15,001 to $50,000.

Attorneys who assist lawmakers with their annual filings say its easy to run afoul. Cleta Mitchell, a member of Foley & Lardners political law practice, said lawmakers frequently use tax preparers and accountants to assist them with financial disclosures, though the process is quite different than completing a tax return.

Its counterintuitive for people who are in the financial world, and its complicated, Mitchell said.

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