Why Vincent Viola turned down Trump's nomination for Army Secretary
鈥淓verybody likes Vincent,鈥� as he signed a nomination for investor Vincent Viola to serve as Secretary of the Army last month. In a rare show of bipartisanship, Senate majority leader Chuck Schumer (D) of New York, agreed. 鈥淚 like Vinnie.鈥�
But their approval wasn鈥檛 enough. On Friday, Mr. Viola, a West Point alum whose business activities have raised his net worth to $1.8 billion, withdrew his name from consideration, .
Having held the rank of major in the Army Reserves and financially supported counterterrorism research at West Point after 9/11, Viola would have brought no small amount of experience to the post. But by stepping down, he avoided the kind of ethical conflicts faced by several of Trump's nominees shifting from the private to the government sector.聽
鈥淲hile wealthy individuals have helmed federal agencies in the past, the vast holdings of Trump鈥檚 nominees presents a challenge for the [federal government鈥檚] small ethics agency,鈥� . 鈥淲orth upwards of $11 billion, Trump's Cabinet would be the richest in history.鈥�
Viola鈥檚 nomination process demonstrated how massive assets can create tough-to-resolve conflicts of interest. He owns a majority stake in Eastern Air Lines, a once-mighty carrier that now handles mostly charter flights. After his nomination, he tried to trade that stake for a smaller one in Swift Air, another charter company.
鈥淪uch a transaction would certainly reduce his exposure to the airline industry, which is heavily regulated by the federal government,鈥� . 鈥滲ut in exchange, Mr. Viola, a retired Army major, may find himself in the precarious position of being a government official who benefits from federal contracts.鈥� Swift Air takes in at least $15 million of taxpayer dollars annually, mostly by flying undocumented immigrants back to their home countries.
Viola also attempted to transfer his ownership and management of the NHL鈥檚 Florida Panthers hockey team, but 鈥渢hat arrangement did not meet Pentagon requirements,鈥� wrote the Military Times鈥檚 Leo Shane III.
It鈥檚 unclear whether Viola鈥檚 efforts to separate himself from his investments would have passed ethical muster at a different agency. Legal experts have given Trump鈥檚 nominees different marks on their resolving conflicts of interest. Matthew Sanderson, former General Counsel to Kentucky Sen. Rand Paul鈥檚 presidential campaign, told the New York Times that White House advisor Jared Kushner鈥檚 plan to sell his assets to family members 鈥�.鈥�
By contrast, Secretary of State Rex Tillerson decided to cut all ties with Exxon Mobil, where he served as CEO. Robert Weissman, CEO of Public Citizen, worries that Tillerson鈥檚 corporate past will still cloud his decision-making. 鈥淭he chances that he will view Russia with Exxon Mobil DNA are close to 100 percent,鈥� .
Even so, William Shaub, director of the Office of Government Ethics, says that Tillerson did all a wealthy businessman reasonably could to prevent conflicts of interest. 鈥淢r. Tillerson is making a clean break from Exxon,鈥� .
鈥淗is ethics agreement serves as a sterling model for what we鈥檇 like to see with other nominees. He clearly recognizes that public service sometimes comes at a cost.鈥�
For other nominees, that cost proves too high. 鈥淚n the past, prospective nominees have quietly walked away from nominations after learning what effect the ethics rules will have on their personal finances,鈥� Mr. Shaub to President Trump鈥檚 transition team in November.
He didn鈥檛 specify which nominees have done so. But Mr. Viola appears to be following in their footsteps.
