Kean stays out of decisions involving personal investments

A New Jersey congressman has told financial advisors who make investment decisions without his input to refrain from investing in companies tied to foreign adversaries and to prohibit shorting the stocks of American corporations.

Rep. Tom Kean, Jr. (R-Westfield) has put all of his investable assets under the management of independent professionals who make decisions “without his input, prior knowledge, or direction,” his attorney, Steve Roberts, said in a letter to the House Ethics Committee advising them of the two-term congressman’s policy.

“To be absolutely clear, Congressman Kean’s finances are in an investment structure where he does not direct, influence, or participate in any stock and investment trading activity whatsoever,” Roberts said.  “Stock transactions in these accounts are handled without his involvement.  Transactions in these accounts are handled without his involvement.”

Soon after taking his seat in 2023, Kean sought to establish a Qualified Blind Trust; however, his insistence that his own guidelines for managing the trust rendered him ineligible for committee approval.

“Unfortunately, the policy interpretations of the committee do not allow Members wishing to establish a Qualified Blind Trust to instruct its trustee to avoid investing in companies tied to foreign adversaries of the United States, such as Russia, Iran, and China,” Roberts stated.  “In addition, the committee’s policy interpretations regarding Qualified Blind Trusts prohibit Members from requiring that their trustees refrain from engaging in short-selling American companies, a speculative practice that involves considerable risk and essentially bets on the failure of American businesses.”

Roberts, who said he will oversee Kean’s financial disclosure and reporting obligations, suggested the Westfield Republican was frustrated by his “inability to place commonsense limitations on how his assets are managed.”

“You could be forgiven for thinking that setting up a blind trust would be a straightforward process, and it may have been what Congressman Kean was expecting when he first directed his lawyer to set one up before he was sworn into Congress.  It has turned out to be anything but straightforward,” said Micah Rasmussen, the director of the Rebovich Institute of New Jersey Politics at Rider University. “Give Kean credit for keeping after it, and for not accepting rules he has found to be less than satisfactory— that there’s no way to restrict a trust from investing in our nation’s adversaries, or from short-selling American companies.  This is obviously something he takes seriously, and it’s important to him that he gets it right.  In the process, he’s hoping his experience can inform improvements in the rules.”

Other members of the New Jersey delegation have also found their own solutions.

During his first year in Congress, Rep. Mikie Sherrill (D-Montclair) opted to sell all of her individual stocks and convert her holdings to Exchange-traded funds (ETFs) that prevent any appearance of conflict.  Her husband, Jason Hedberg, is a stock trader at UBS Securities and was restricted from trading his own stocks even before his wife’s election to Congress. The 2019 decision to divest of individual stocks appears to raise their personal bar even higher.

Last year, Kean and Rep. Hillary Scholten (D-Michigan) introduced bipartisan legislation that prohibits members of the House and Senate from profiting from foreign adversaries or companies designated by the State Department as adverse to U.S. interests.

“The public servants who represent our country should not be profiting off other countries who wish to do us harm,” Kean said.  “We cannot tolerate politicians who prioritize personal gain over what is best for the American people. Republicans and Democrats need to come together to ensure honesty and transparency in government.”

With another Democrat, Rep. Angie Craig (D-Minnesota), Kean introduced a bill last month that would ban the short sale of particular stock by Members of Congress and their spouses and dependents.