Sen. Jeff Sessions plans to divest about $31,000 in corporate bonds for a Brazilian oil company embroiled in a large corruption scandal, among other moves to avoid financial conflicts as Donald Trump’s pick to be attorney general.
The Alabama Republican also will divest an appropriate amount of his investments in the health care and technology market sectors to comply with limits set out in executive branch ethics rules, a Trump transition source said in response to CQ Roll Call questions.
Sessions, who reported a combined net worth with his wife just shy of $7 million, mainly owns real estate, mutual funds and municipal bonds. That makes his financial picture simpler than some of Trump’s other Cabinet selections, who are billionaires or multimillionaires.
“This is one of the cleanest financial disclosure statements officials will see,” the Trump transition source said.
Sessions owns two bonds related to Petroleo Brasileiro SA, known as Petrobras. Brazilian investigators in 2014 broke up what has become the largest corruption scandal in the country’s history involving Petrobras directors and even politicians, but it continues to unfold.
The U.S. Justice Department has been investigating Petrobras, a majority of which is owned by the Brazilian government, and other companies for international bribery, and the state-controlled oil company could face a payment to settle with the agency, according to reports from Reuters and Bloomberg.
Sessions reported corporate bonds worth $14,879 in Petrobras International Finance Co. and $16,560 in Petrobras Global Finance as part of his financial disclosure to the Senate Judiciary Committee, filed ahead of his confirmation hearings. Without divesting those bonds, Sessions as the nation’s top law enforcement officer might have to recuse himself from participating in any investigation or decisions on Petrobras.
The company has other legal troubles. Investors filed a class-action lawsuit in New York accusing Petrobras of destroying $200 billion of shareholder value, Reuters reported.
Generally, if a government official has a financial interest in a matter, and if an action on the matter could affect the financial interest of the official, then the official is not allowed to participate, said Kathleen Clark, a law professor at Washington University in St. Louis and an expert on ethics for lawyers and government officials.
Mutual funds that are sufficiently diversified don’t cause a conflict of interest and trigger the recusal statute, Clark said. But a mutual fund may require recusal if it focuses on an industry, a business, a single country other than the U.S. or a state’s government bonds. The Justice Department could have an impact on a particular industry, such as antitrust enforcement in health care and technology.
For municipal bonds or real estate, government officials likely would have to recuse themselves to avoid participating in an action that could affect the value of those investments.
Sessions listed his Senate salary as $159,500 in committee paperwork, covering his earnings through Nov. 30. The current annual salary for rank-and-file lawmakers is $174,400.
Senators are poring over the financial disclosures and more than 150,000 pages of material that Sessions submitted in response to a Senate Judiciary Committee questionnaire released Friday.
Sessions, 69, is seeking to head an agency with a $29 billion budget. As the nation’s top law enforcement officer, he also would oversee the nation’s immigration courts, as well as policies on criminal prosecution for everything from drug traffickers and white-collar criminals to civil rights issues such as voting rights.
Democratic senators have said they will air concerns about some of those issues at confirmation hearings scheduled for Jan. 10-11.
Committee ranking member Dianne Feinstein of California said in a letter Tuesday to Chairman Charles E. Grassley of Iowa that reviewing Sessions' voluminous materials will likely take longer than it did for prior nominees. Current Attorney General Loretta Lynch, for example, produced 1,500 pages of materials for her confirmation.
Feinstein also noted that some answers on Sessions’ questionnaire are incomplete, such as failing to provide many speeches given on behalf of then-candidate Trump.