Sending Office: Honorable David N. Cicilline
Sent By:
Renuka.Nagaraj@mail.house.gov

Ask for an Ethics Investigation on Trump’s Pledge to Save ZTE

Closing Wednesday, May 23rd COB

Dear Colleague,

As you may know, President Trump recently took steps to save ZTE, one of China’s biggest telecommunications companies, from the brink of collapse, although ZTE was found to have conspired to sell American technology to hostile regimes in Iran and North Korea. 
The Commerce Department banned American firms from selling parts or providing services to ZTE but the President Trump inexplicably pledged to ease these restrictions.  On May 22, 2018, The Washington Post reported that
President Trump’s advisers have outlined an agreement with leaders in Beijing on lifting the ban on ZTE.

Just three days before Trump’s announcement, The South China Morning Post reported that the Chinese government would be providing $500 million in loans for an Indonesian theme park project.  The project will be built by a Chinese
state-owned construction company and will include several Trump-branded properties, such as residential developments, shops, a hotel and a golf course.  The Chinese government’s loan provides a clear financial benefit to President Trump who still owns the
Trump Organization and retains interest in his businesses via a revocable trust, from which he can draw funds at any time of his choosing. 

We should all be concerned by the suspicious timing of this decision and the Chinese government’s loan to a Trump-linked project.  This raises serious questions about possible manipulation of U.S. policy by a foreign government, and the President using foreign
policy to benefit his own financial interests.  Please join me in asking the Office of Government Ethics to conduct a prompt review of constitutional and ethical questions raised by these events. 

Please contact my Legislative Counsel, Renuka Nagaraj, with questions or to sign on at Renuka.Nagaraj@mail.house.gov or x54724 . 

Thank you for your attention to this matter.

 

David N. Cicilline

Member of Congress

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May 24, 2018

 

David J. Apol

Acting Director

U.S. Office of Government Ethics

1201 New York Avenue, N.W., Suite 500

Washington, DC 20005

 

Dear Acting Director Apol:

 

We write to express our strong concerns about the recent dealings between President Donald J. Trump, the Trump Organization and the Chinese government, which may have violated U.S. laws on the acceptance of payments or gifts by public officials.

As you know, the Trump Organization, which President Trump controls, signed a deal to license President Trump’s name as part of a theme park development project outside of Jakarta, Indonesia.  The project will be built by a Chinese state-owned construction
company and will include several Trump-branded properties, such as residential developments, shops, a hotel and a golf course.  On May 11, 2018, the South China Morning Post reported that the Chinese government is providing $500 million in
loans for the Indonesian theme park project. 

The Chinese government’s loan provides a clear financial benefit to President Trump. Despite the  nearly unanimous recommendation by legal experts that he divest from his business interests before assuming the presidency, he failed to do so, instead placing
his adult children in charge of day-to-day operations.  The President also retains interest in his businesses via a revocable trust, from which he can draw funds at any time of his choosing.  Therefore, the President will be able to monitor the Indonesian
project and earn a profit if it succeeds.

Three days after news broke of the Chinese government’s loan to the Trump project, the President announced that he ordered his administration to save ZTE, one of China’s biggest telecommunications companies, from the brink of collapse.  Last month, the Commerce
Department blocked American firms from selling parts or providing services to ZTE for seven years, after the company violated an agreement to pay a $1.2 billion fine for conspiring to sell U.S. technology to Iran and North Korea.  After only five weeks of
being denied U.S. parts.   ZTE has lost millions of dollars and is in the midst of shutting down production operations.  To relieve pressure on the company, President Trump pledged that the Commerce Department will ease restrictions on ZTE.  On May 22, 2018, The
Wall Street Journal
 reported that the U.S. and China had agreed on a broad outline of a deal to lift the sales ban on ZTE.

We believe that these events raise several potential constitutional and ethical violations.  First, the Chinese government’s loan may invoke the Emoluments Clause of the United States Constitution, which prohibits officials holding an “office of profit or
trust” from accepting payments or gifts from a foreign government without the consent from Congress.  Furthermore, the extremely short time between the Chinese’s government’s loan and President Trump’s order to roll back penalties on ZTE warrants a review
of any applicable federal ethics regulations.

Therefore, we ask you to investigate the following matters.

  • Whether the Emolument Clause applies to the $500 million loan by the Chinese government used to finance an Indonesian theme park project with several projected Trump-branded properties;
  • Whether President Trump sought and obtained the consent of Congress before the Chinese government made the $500 million loan benefiting Trump properties; and
  • Whether any federal statute regarding conflicts of interest or ethics may apply to President Trump or a member of the Trump administration who participated in the decision  to ease restrictions on ZTE.

The Trump administration has yet to give a satisfactory answer about the reason behind and the appropriateness of making concessions to ZTE, a Chinese company that illegally sold U.S. technology to hostile regimes.  The Trump administration has also completely
failed to address the suspicious timing between this policy reversal and the Chinese government’s loan to a Trump-linked project.  As you know, the issue of U.S. policy being manipulated by a foreign entity or the personal business interests of a public official
is of grave concern to the American people.  We ask that you promptly conduct a review of this matter and keep us apprised periodically about the progress of your investigation.

Thank you for your attention to this matter.

 

David N. Cicilline

Member of Congress

Related Legislative Issues

Selected legislative information: Ethics and Standards, Government

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