Pruitt once bought Oklahoma home from lobbyist: report

EPA Administrator Scott Pruitt once purchased a house from a top lobbyist in Oklahoma with the help of a shell company, The New York Times reported Saturday.

Two business associates involved in the 2003 purchase are now aides to Pruitt at the agency: Kenneth Wagner, a senior adviser at the EPA, and Albert Kelly, who runs the agency’s effort to redesign the Superfund program.

According to the Times, the home, which was seen as a prime property because of its proximity to the state Capitol building, was purchased for $375,000 from a retiring telecommunications lobbyist.

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But that price was $100,000 less than the lobbyist, Marsha Lindsey, had paid for it just a year before. The shortfall, according to the Times, which examined the records, was picked up by Lindsey’s company, telecom giant SBC Oklahoma.

The company, now a subsidiary of AT&T, lobbied on a number of matters including a deregulatory bill that would allow it to raise rates and an effort to reopen a decade-old bribery case. According to the Times, Pruitt sided with the company on both matters.

Pruitt, then a state senator, intended to use the residence as a place to stay while Oklahoma’s legislature was in session. During this time he also rented out a room to another Republican state senator, Jim Dunlap.

Wagner, who was a partner at the private legal practice where Pruitt worked, was a co-investor in the shell company that purchased the residence.

Kelly wasn’t involved in the shell company but ran the community bank which issued the mortgage for the residence. Kelly was later barred for life from the banking industry by the Federal Deposit Insurance Corporation (FDIC) because the agency had “reason to believe that [Kelly] violated a law or regulation, by entering into an agreement pertaining to a loan by the Bank without FDIC approval.”

The two now hold top positions at the EPA.

In 2005, the company owned by Wagner and Pruitt sold the residence for $95,000 more than it had paid just two years earlier.

Dunlap told the Times that he had no knowledge that Pruitt had purchased the residence from a lobbyist. He said he was under the impression that Pruitt had purchased it from a group of lawyers.

“This was a place where you slept and had dinner,” Dunlap told the Times. “It was all above board.”

The Oklahoma deal is only the latest in a series of stories raising ethics issues involving Pruitt.

Pruitt was reported earlier this month to have been living in 2017 in a Washington, D.C., condo partly owned by the wife of a top energy lobbyist at a rate of just $50 per night, which he and others have insisted was market value.

The EPA chief also came under fire after it was discovered that two top aides received raises after the White House declined to approve the pay hikes.

When asked about the Oklahoma house deal and Pruitt’s business relationship with his top appointees, an EPA spokeswoman told the Times that the dealings “were ethical” and that Pruitt’s stake in the company “was a simple real estate investment.”

“Mr. Wagner and Mr. Kelly left high-profile positions in law and banking in Oklahoma, to serve in the administration,” the spokeswoman said in an email to the Times.

“They are dedicated EPA employees who have earned the respect and admiration of EPA career employees across the country. They serve the country professionally, and transparently — and are committed to ensuring the programs they work on are successful.”