Postal Updates

PMG Louis DeJoy faces potential new legal trouble

Sep 9, 2020, 3 PM
Postmaster General Louis DeJoy is facing a new legal problem that has nothing to do with the mail.

Washington Postal Scene by Bill McAllister

Postmaster General Louis DeJoy, often described as a generous Republican Party donor, is facing a new legal problem that has nothing to do with the mail.

After the Washington Post and The New York Times reported Sept. 6 that he could be investigated by North Carolina authorities, President Donald Trump joined a chorus of Democrats Sept. 7 calling for an inquiry into DeJoy’s fundraising for Republicans.

The newspapers reported statements by some of his former employees in North Carolina who said they were pressured to give to GOP causes and later given bonuses as rewards.

The papers said that former workers at New Breed Logistics, DeJoy’s former business in Greensboro, N.C., reported they were urged by DeJoy or his top aides to write checks for the GOP.

David Young, who was DeJoy’s human resources chief, put it bluntly: “He asked employees for money. We gave him the money and then he reciprocated by giving us big bonuses.”

It is illegal under both federal and North Carolina law for companies to reimburse employees for making political donations.

Trump, who has personally benefited from DeJoy’s political donations, told reporters that DeJoy should resign if those inquires show the postmaster general did something wrong.

Congressional Democrats, who have been wary of DeJoy because of his financial support of Trump and his initial actions as postmaster general, were quick to denounce him over the newspaper accounts.

“This report demands a full, independent investigation,” said Rep. Adam Schiff, D-Calif.

Senate Minority Leader Charles Schumer, D-N.Y., agreed. “These are very serious allegations that must be investigated immediately, independent of Donald Trump’s Justice Department,” he said.

Schumer suggested that North Carolina State Attorney General Josh Stein might be the best person to probe the issue.

In a statement, Stein said that “it is against the law to directly or indirectly reimburse someone for a political contribution” and that “any credible allegations of such actions merit investigation by the appropriate state and federal authorities.”

Both newspapers reported that at an August congressional hearing DeJoy angrily denied a suggestion by Rep. Jim Cooper, D-Tenn., that he had reimbursed his employees for political donations.

“That’s an outrageous claim, sir, and I resent it,” he said. “What are you accusing me of?”

Rep. Jackie Speier, D-Calif., urged Trump to remove DeJoy.

“It now appears that we have a U.S. postmaster who engaged in campaign money laundering when he was running his logistics company,” she said in a tweet.

Rep. Carolyn B. Maloney, D-N.Y., chairwoman of the House of Representatives’ Committee on Oversight and Reform, urged the Postal Service’s board of governors immediately suspend DeJoy. “If these allegations are true, Mr. DeJoy could face criminal exposure — not only for his actions in North Carolina, but also for lying to our committee under oath,” she said.

A DeJoy spokesman told the Post that DeJoy had sought legal advice on election laws “to ensure that he, New Breed Logistics and any person affiliated with New Breed fully complied with any and all laws.”

The spokesman also said that no one at the Greensboro company complained to DeJoy that they were under “any pressure” to make a political donation and that he regrets “if any employee felt uncomfortable for any reason.”

The Post said it found that 124 New Breed employees gave more than $1 million to state and federal Republican candidates between 2000 and 2014.

The Times said its review of campaign records showed that more than a dozen New Breed management officials “would routinely donate to the same candidate on the same day, often writing checks for an identical amount.”

The Times also said it found a similar pattern of giving by New Breed officials that dates back to 2003 with donations to George W. Bush’s presidential campaign.

The Post noted that while it is legal to encourage workers to make political donations, reimbursing them for those donations is a violation of both North Carolina and federal laws.

The practice is known as a straw-donor scheme because it allows donors to evade individual campaign gift limits and it masks the actual source of funds.

Federal election-law violations carry a five-year statute of limitations, but there is no such limit in North Carolina for election law crimes.

During hearings, DeJoy has acknowledged that he has been a major Republican donor. He also has stressed that he has followed all ethics rules and requirements before he became the nation’s 75 postmaster general on June 15.

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