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Pritzker creates blind trust, will divest from companies with state business

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Illinois

The richest person ever to become Illinois governor says he will take the strongest steps allowed by law to ensure that control and investment of his personal wealth is kept separate from his official duties.

In an announcement being made today, Gov.-elect J.B. Pritzker, the multi-billionaire who is scheduled to be sworn into office just days from now, says that all of his personal assets will be placed into a blind trust managed by Northern Trust. The firm will “control all aspects” of how to invest the money, and give him only the minimum of information needed to file his income tax returns and the state’s annual statement of economic interest.

Other assets, held in Pritzker-family trusts for him and other beneficiaries of the Hyatt Hotels empire, will be managed by those trusts without input from him, documents released by Pritzker indicate. As with personal assets, the governor will receive only “the minimum amount of information necessary to prepare and verify his statement of economic interests, his personal income tax returns and other financial filings required by law,” one document states.

Pritzker also will sell his personally-held interest in any company that has a contract wholly or partially funded with state money, aides said. And if any company in which his trusts invest ends up acquiring a state contract during his term and makes a positive return, Pritzker “will make a charitable contribution in the amount of that return.”

* From a press release…

Governor-Elect Pritzker believes that public service is a public trust, and he has taken steps to ensure that the Illinois Governor’s Office operates free of any financial conflict of interest and upholds the highest ethical standards during his term of office.

Governor-Elect Pritzker has created a blind trust to manage his personal assets, and has removed himself from decision-making authority and knowledge of decisions of family trusts that he is a part of. Extensive work has taken place to eliminate potential conflicts of interest while also ensuring the Governor-Elect can meet Illinois’ reporting requirements.

* From a Perkins Coie LLP memo…

* Governor-Elect Pritzker is divesting his personally-held direct interests in companies that have contracts that are wholly or partially funded with state dollars. Pursuant to 30 ILCS 500/50-13(a), neither Governor-Elect Pritzker, M.K. Pritzker, nor their minor children will have or acquire any direct pecuniary interest in a contract during his term of office that is satisfied with state funds.

* Governor-Elect Pritzker is voluntarily placing his remaining personally-held assets into a blind trust. Governor-Elect Pritzker has appointed the Northern Trust Company as independent trustee responsible for managing and controlling the trust. The blind trust terms prohibit the Governor-Elect from exercising any management or control over assets held in the trust. The terms further prohibit direct or indirect communication between Governor-Elect Pritzker and the trustee except to the extent described below. The terms severely limit the information he is entitled to receive about the trust, its assets, its performance, and its management. The only communication Governor-Elect Pritzker may have with the trustee is to receive minimum amount of information needed to (1) properly file his personal income tax returns and other filings required by law; (2) verify his Statement of Economic Interests under the Illinois Government Ethics Act; and (3) comply with the provisions of the Illinois Procurement Code. In the event Governor- Elect Pritzker becomes aware that he is entitled to receive a return from an investment held in trust in which the underlying company enters into or acquires a state contract during his term, the Governor-Elect will make a charitable contribution in the amount of the return.

* Governor-Elect Pritzker is a beneficiary of several domestic and foreign trusts. These trusts are irrevocable, and the preexisting trust instruments do not grant Governor-Elect Pritzker authority to alter or terminate the trust or its investments. Moreover, Governor- Elect Pritzker does not receive distributions from any foreign trust. For several of the domestic and foreign trusts, Governor-Elect Pritzker has the limited ability to direct trust distributions to certain beneficiaries (not including himself) who are specified in the trust instruments. The Governor-Elect has committed to the following rules further limiting his involvement in these trusts: (1) Governor-Elect Pritzker will not make asset allocation or risk decisions regarding assets held in these trusts. Instead, the respective trustees will control all aspects managing the trust investments. (2) Governor-Elect Pritzker will not receive regular reporting regarding the performance of assets held in these trusts. The Governor-Elect has instructed the trustees to provide him only with the minimum amount of information necessary to prepare and verify his Statement of Economic Interests, his personal income tax returns, and other financial filings required by law. (3) Governor- Elect Pritzker will not take any action in his official role or communicate with any office of Illinois government regarding assets held in trust, nor will any such assets receive any favor or advantage in any Illinois government proceeding. (4) In the event Governor- Elect Pritzker becomes aware that he is entitled to receive a return from an investment held in trust in which the underlying company enters into or acquires a state contract during his term, the Governor-Elect will make a charitable contribution in the amount of the return. The complete rules Governor-Elect Pritzker has outlined regarding these trusts are included as Attachment A to this memorandum.

* To ensure the highest levels of transparency and ethical compliance are maintained throughout his term in office, Governor-Elect Pritzker is appointing an independent compliance adviser. The advisor will oversee a team of attorneys and ethics experts to advise the connected parties on compliance considerations regarding potential conflicts that arise.

* Finally, Governor-Elect Pritzker will also continue to comply with the terms of the Illinois Government Ethics Act by disclosing his assets on a public Statement of Economic Interests. The Statement of Economic Interests will allow the media and members of the public to verify that none of Governor-Elect Pritzker’s holdings conflict with his ability to fairly and impartially execute the duties of his office.

Also, a transition spokesperson told me today that the sale of the Pritzker family’s Grand Victoria Casino in Elgin was finalized last year.

posted by Rich Miller
Thursday, Jan 10, 19 @ 1:11 pm

Comments

Wonder if there is a plan to tell folks what he is selling. GovJunk “disclosures” were clear as mud. Mostly alphabet investment funds and no accounting. Thus his role in the Westmont poison plant was not well known.

Comment by Annonin' Thursday, Jan 10, 19 @ 1:20 pm
Ethics matter

Comment by Precinct Captain Thursday, Jan 10, 19 @ 1:21 pm
I bet we still be IPI and such complaining about ethics every time a toilet moves. /S

Comment by Union thug Thursday, Jan 10, 19 @ 1:30 pm
This should be law. We can’t rely on politicians to do the right thing and assume that all future leaders will do this for fear of public backlash.

Comment by ShyBoy Thursday, Jan 10, 19 @ 1:36 pm
What a stark contrast with the resident in the White House.

Comment by anon2 Thursday, Jan 10, 19 @ 1:37 pm
nice
hat tip

Comment by Team Warwick Thursday, Jan 10, 19 @ 1:37 pm
This is why I voted for you. Good man!

Comment by Brendan Thursday, Jan 10, 19 @ 2:18 pm
Yes it should be a law especially since looks like higher office will be a rich person’s game now on
I am more concerned about the ethics of a person of average income who leaves rich or makes friends rich. See Burke Daley And a host of others

Comment by DuPage Saint Thursday, Jan 10, 19 @ 2:21 pm
–In an announcement being made today, Gov.-elect –J.B. Pritzker, the multi-billionaire who is scheduled to be sworn into office just days from now, says that all of his personal assets will be placed into a blind trust managed by Northern Trust. The firm will “control all aspects” of how to invest the money, and give him only the minimum of information needed to file his income tax returns and the state’s annual statement of economic interest.–

And that’s the way you really do it, not the phony-baloney, not-so-blind-trust Rauner set up.

Comment by wordslinger Thursday, Jan 10, 19 @ 2:40 pm
An actual “blind” trust instead of Rauner’s “nearsighted” trust.

I’ll be darned.

Comment by 37B Thursday, Jan 10, 19 @ 5:34 pm
No back porch portfolio?

Comment by Anonymous Friday, Jan 11, 19 @ 7:29 am
And the contrasts with recent history just keep coming…….

Comment by Jerry Friday, Jan 11, 19 @ 9:01 am