Betsy DeVos has a whole new problem
Education Secretary Betsy DeVos listed more than one hundred financial interests she or her family had that presented potential conflicts in her required filings with the Office of Government Ethics. Her 108-page financial disclosure was very complex. One of the disclosures made in her OGE filings was an interest in Theranos, a blood-testing firm that closed its labs and laid off its workers last year when The Wall Street Journal questioned the startups’ technology.
On the OGE financial disclosure form, to which nobody is alleging that DeVos failed to disclose any financial interest, DeVos listed Theranos as having a value of “Over $1,000,000.” The OGE Form 278e, which is the one DeVos completed, has a top bucket for value that is the over $1,000,000 as Theranos is identified. The investments in Theranos, according to recently released documents in a fraud lawsuit against Theranos, are “essentially worthless.”
Several investors, including the Walton family, Rupert Murdoch and the Cox family all lost substantial amounts totaling $600 million. DeVos’ family invested $100,000,000 in Theranos, and DeVos called it an “understatement” that her family was “disappointed” by the fate of Theranos.
The founder, Elizabeth Holmes, had sent investors an email on April 10 that Theranos was being liquidated. The loss is a substantial one for DeVos and her family and many other investors. The OGE might look at this situation and determine if the form should be updated to have larger categories or buckets of valuations, as the OGE Form 278 (Executive Branch Personnel) contains. In the Form 278, it includes larger buckets, as follows:
• $1 million to $5 million;
• $5.0 million to $25.0 million;
• $25.0 million to $50.0 million; and,
• Over $50.0 million.
These buckets might be more insightful for the Senate and for the OGE when nominees are submitted to review for troubling conflicts and discuss disposal by the candidate. In the meantime, the DeVos family has lost a significant investment.
Daniel is a lawyer writing and teaching about SCOTUS, and is the author of the book “The Chief Justices” about the SCOTUS as seen through the center seat.