Virginia Gov.-elect Terry McAuliffe took two more steps to prepare for public office Thursday, forming a bipartisan committee to guide his transition and announcing that he will put his considerable wealth into a blind trust and sell his stake in two recent, controversial business ventures.
“Governor-elect Terry McAuliffe and his wife Dorothy McAuliffe, with my assistance, have begun the process of establishing a blind trust for their personal assets and divesting from potential conflicts of interest,” Thomas Richardson, a partner in the law firm Arnold & Porter, said in a statement issued Thursday. “This process will be completed prior to the official inauguration in January. We will be announcing a trustee in the coming weeks who will oversee the trust for the duration of McAuliffe’s time in office.”
Megan Grant, a spokeswoman for McAuliffe, said McAuliffe will divest his stake in GreenTech Automotive, an electric car company he co-founded. The Securities and Exchange Commission is investigating GreenTech’s use of a federal program that grants visas to foreign investors.
McAuliffe has said he resigned as chairman of the company in December 2012, but he was identified as “the largest individual shareholder” in the company in a March 2013 prospectus for investors. He has disclosed only that he owns more than $250,000 worth of GreenTech stock.
Grant said McAuliffe also would divest his interest in Capital Management International, a McLean-based investment partnership that was involved in an as-yet-unsuccessful effort to build a fuel-pellet factory in Franklin, a town in rural Southside Virginia.
McAuliffe’s millions and his complex business relationships — many of them with people he knows through politics — have been a source of controversy throughout his career and were the subject of frequent attacks during his race for governor against state Attorney General Ken Cuccinelli II (R).
Republicans repeatedly called on McAuliffe to release several years’ worth of tax returns, which Cuccinelli did but gubernatorial candidates generally have not done. McAuliffe released only the summary pages of his returns for the past four years. They showed that he earned $9.5 million in 2012 and $8.2 million in 2011.
McAuliffe did file a personal financial disclosure form with the state of Virginia, but the form uses broad ranges. It shows that he had 25 investments worth at least $250,000 apiece, plus several smaller investments.
Owners of blind trusts cede decisions about managing their money to a trustee. Some politicians choose to set up blind trusts to avoid the appearance of being in position to profit from decisions made in their official capacity.
Using a blind trust is not an automatic move for Virginia governors.
Sen. Mark R. Warner (D) put his assets in a blind trust after he was elected governor in 2001. “I thought it was the cleanest way to go. For the next four years I won’t know what I own,” he said at the time.
His two successors — now-Sen. Timothy M. Kaine (D) and the current governor, Robert F. McDonnell (R) — did not use blind trusts. Neither of them, however, has a fortune comparable to McAuliffe’s.
McDonnell’s finances have been the subject of intense scrutiny. He, his wife and children received more than $160,000 in gifts and loans from Jonnie R. Williams Sr., chief executive of the dietary supplement company Star Scientific. Those gifts are the subject of state and federal investigations.
McAuliffe’s newly formed transition committee is a bipartisan mix of 52 public officials and business leaders, not all of whom supported McAuliffe’s campaign.
The committee includes several Republicans, including state Sen. John C. Watkins (Powhatan) and Del. Christopher K. Peace (Hanover). Also onboard are longtime political consultant Boyd Marcus and Virginia Beach Mayor Will Sessoms, two Republicans who endorsed McAuliffe.
Among those on the Democratic side are legislators and some prominent Northern Virginians, including Sharon S. Bulova, chairman of the Fairfax County Board of Supervisors, and Aneesh Chopra, the former U.S. chief technology officer.