Sen. Inhofe criticized after purchasing stock in defense contractor after pushing for more military spending
Republican Senator James Inhofe of Oklahoma, the chairman of the powerful Senate Armed Services Committee, blamed his investment firm for a purchase of thousands of dollars in defense stock and claimed he was unaware of the transaction at the time.
According to a Senate financial disclosure report, Inhofe listed a purchase of $50,000-$100,000 in stock in US defense contractor Raytheon, days after successfully pushing the Trump administration for more Defense Department spending. Inhofe’s communications director said he canceled the transaction when he became aware of it.
Inhofe told CNN in an interview Thursday on Capitol Hill that he had “no saying in any of the investments that took place” by Capital Advisors, an Oklahoma-based investment management company.
The Oklahoma senator said he “intentionally” uses a third-party adviser “so I don’t have any decision or any choice in what they invest in.”
“And this way, in fact, I don’t even know about it,” Inhofe told CNN. “I don’t even know what they invest in.”
He added, “That’s the truth, and I know people don’t want to believe that, that is fine.”
The Daily Beast was the first to report on the stock purchase.
President Donald Trump recently agreed to a defense budget of $750 billion for the coming year, reversing his plans to shrink a $716 billion defense budget allocated in 2019 that he thought was too much money, calling it “crazy.” Trump’s decision came out of a meeting with Inhofe, along with Defense Secretary James Mattis and the chairman of the House Armed Services committee, Rep. Mac Thornberry, R-Texas. The listed date for the purchase was Tuesday, a week after the meeting.
The purchase raises conflict of interest questions because Inhofe is now the leader of the Senate committee that approves the Pentagon’s budget. Inhofe recently took over the chairmanship of the committee after the death of Sen. John McCain, the Arizona Republican who had long served as the top Republican on the committee.
Inhofe said he was “concerned about how it would look” as a conflict of interest, but he added, “If you only have people serving in the United States Senate who don’t have any resources of their own, what kind of a Senate are you going to have?”
Asked if he was worried about the timing optics of the purchase with his push for more defense spending, Inhofe said, “Well, you guys really enjoy that, don’t you? No, that’s my job to try to undo the damage that was done during the Obama years so we can adequately defend America.”
Inhofe’s communications director Leacy Burke told CNN in a statement Wednesday night that “the senator was not aware of this stock purchase until it came through the system very early this morning.”
“All of Sen. Inhofe’s financial transactions are handled by a third-party adviser,” Burke said. “The senator has had no involvement in and has not been consulted about his stock transactions.”
Burke said that Inhofe told his financial adviser to reverse the transaction once he was aware.
“This means that the transaction was canceled before it was settled; the senator never took ownership of it,” she said.
Burke said a new report had been filed with the Senate ethics office. An amended report was posted Wednesday night without the Raytheon stock purchase listed.
In a letter, Inhofe wrote to Capital Advisors CEO Keith Goddard instructing him to “no longer purchase defense or aerospace companies as part of my financial holdings.” The letter was dated Wednesday.
“Because of my new position as chairman of the Senate Armed Services Committee, it is important for me to not own or trade any defense or aerospace companies,” the letter stated, according to a copy provided to CNN by his office.
The Daily Beast, which first reported on the letter, noted that the document’s metadata indicated it was created 20 minutes after the news outlet reached out for comment.