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Ross May Give Up Stake in Firm with Russia Ties

The U.S. Commerce Secretary said he would “probably not” keep his stake in a shipping company that does business with Putin's allies, as Democrats call for an investigation.

U.S. Commerce Secretary Wilbur Ross said he would “probably not” keep his stake in a shipping company that earns millions of dollars from an energy company whose key owners include Russian President Vladimir Putin’s son-in-law and two Russian oligarchs.

“I’ve been actually selling it anyway, but that isn’t because of this,” Ross said in an interview with Bloomberg Television a day after the International Consortium of Investigative Journalists and its media partners worldwide revealed the ties between the shipping company, Navigator Holdings, and Sibur, a Russian oil and petrochemical giant.

In multiple media appearances, Ross said that he had done nothing wrong because Sibur was never under U.S. sanctions.

“There’s nothing whatsoever improper about Navigator having a relationship with Sibur,” Ross told the BBC.

The ICIJ reported that, although Ross divested 80 financial holdings, the former private equity dealmaker maintained a stake in Navigator through a chain of companies in the Cayman Islands. Ross companies at one point owned a majority of Navigator’s stock and had two seats on the company’s board.Ross kept only his personal stake in the company. The stake was disclosed in filings Ross made after he was nominated to be commerce secretary, a job that puts him in the middle of trade and shipping issues that could pose a conflict of interest for him, though his holdings are legal.

The issue never came up in his confirmation hearings, and U.S. Senator Richard Blumenthal (D-Conn.), a member of the Committee on Commerce, Science and Transportation, said Ross should have been more forthcoming about the relationship.

“In concealing his interest in these shipping companies – and his ongoing financial relationship with Russian oligarchs, Secretary Ross misled me, the Senate Commerce Committee and the American people,” Blumenthal said. “Secretary Ross’ financial disclosures are like a Russian nesting doll, with blatant conflicts of interest carefully hidden within seemingly innocuous holding companies.”

A spokesman for Sen. John Thune (R-S.D.), who heads the Senate Commerce Committee, said that the relationship “was disclosed” and that the committee expects that Ross “will follow the advice of the department’s ethic officers should there be a determination that any holding creates a conflict of interest.”

Vermont Senator Bernie Sanders, the former contender for the Democratic presidential nomination, told The Guardian newspaper that ICIJ’s Paradise Papers “shows how these billionaires and multinational corporations get richer by hiding their wealth and profits and avoid paying their fair share of taxes.”

He said that Congress needs to close loopholes and demand “a fair and progressive tax system.” instead of “providing even more tax breaks to profitable corporations like Apple and Nike and billionaires in Trump’s cabinet who avoid billions in U.S. taxes by shifting American jobs and profits to offshore tax havens.”

Other members of Congress also cited the Paradise Papers in the debate on tax legislation recently introduced by Republicans in Congress. Republicans seek to cut taxes by some $1.5 trillion dollars, including a significant reduction in the corporate tax rate.

“By failing to close the egregious loopholes outlined in the Paradise papers, the Republican plan rewards wealthy billionaires like Secretary Wilbur Ross for dodging taxes, while punishing many in the middle class with new tax hikes,” the Senate Minority Leader Charles Schumer (D-N.Y.) and Sen. Ron Wyden (D-Ore.) wrote in a joint statement.

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