Louis DeJoy Comes Under Scrutiny ' Again ' As USPS Awards $120 Million Contract To His Former Employer

ToplineU.S. U.S. Postal Service PostmasterGeneral Louis DeJoy is back in the spotlight. The Washington Post reported that DeJoy could make a profit from a contract his former employer has signed with USPS. This was just hours after USPS board members publicly attacked the Postmaster Generals plans to change the Postal Service.United States Postmaster General Louis DeJoy during a House Committee on Oversight and Reform Hearing n... [+] February 24, 20,21. Getty ImagesThe Key FactsThe Post reported that USPS gave a $120 million contract in April to XPO Logistics. DeJoy was employed there until 2015, when New Breed Logistics acquired him. He worked at two sorting/distribution facilities in Atlanta, Washington, D.C. The Post reports that DeJoy and his entities have sold between $65.4 million to $155.3 million of XPO shares. However, DeJoy's family still owns four buildings and could make DeJoy's companies as much as $23.7 million in the next ten year. Forbes was told by XPO that the company's deal was done through a standard competitive bid process. USPS also told Forbes that DeJoy didn't participate in the contract procurement process. DeJoy has withdrawn himself from any matters involving XPO. After USPS held its first open meeting of its board of governors since the appointment by Biden, XPO stated that the company's deal was made through a standard competitive bidding process. USPS also informed Forbes that DeJoy did not participate in the contract procurement process. DeJoy has withdrawn himself from matters involving XPO. Stroman criticised the plan for being poorly designed and stated that it poses dangerous risks that aren't justified by its relatively low financial returns. Hajjar, however, noted that there was much to like about the plan but also criticized aspects that would slow down mail delivery. DeJoy, a Democrat, and USPS board chair Ronald Bloom (a Democrat), continued to defend Friday's changes to the agency despite criticism from the Biden appointees as well as the Postal Regulatory Commission. The Commission previously determined that the controversial plan would not lead to much improvement to the Postal Services financial situation.Important QuoteAlthough he could have gotten rid of them, he chose not to. He is making that choice, Lisa Graves of True North Research, executive director of private ethics research firm True North Research told the Post about DeJoys financial ties to XPO. This means that, even though he isn't the one making the decision about XPO, others within the Postal Service are aware of the potential benefits and could be able to curry favor with him.Chief CriticsJoseph Checkler, an XPO spokesperson, told Forbes via email that the USPS contracts were awarded to the agency by USPS career procurement officers. The agency has been a long-standing customer of XPO and regularly participates in the USPSs standard competitive bid process for contracts. We have won in some cases. Checker stated that we have lost in other cases. The USPS ethics officials cleared DeJoys company leasing to XPO. A Postal Service Inspector General reported that USPS spokesperson Jeffery Adam noted to the Post that they were also disclosed in DeJoys financial records. Adams stated that the Office of Government Ethics approved Mr. DeJoys XPO recusal agreement as a remedy for any issues regarding possible conflicts of interest in relation to this landlord/tenant relationship.Important BackgroundSince his appointment by President Trump to his position, DeJoy has been a hot topic. He is a long-time GOP fundraiser and businessman. There was widespread opposition to DeJoy's new changes to the postmaster general that caused mail to slow down nationwide. These changes were made in response to court orders, particularly in the lead-up to the election where mail-in ballots were an issue. The postmaster general's possible financial conflicts of interests have been a problem for a while. Critics have repeatedly criticized his ties to former companies and USPS stakeholders such as Amazon, which the Post reports DeJoy also divested from, among many other companies. Although DeJoy insists that there is no improper dealings with his financial assets, ethics experts raised concerns in September when Richard Painter, former chief ethics lawyer at the White House, testified before Congress that it was very possible that DeJoy violated federal conflict-of-interest rules unless he has not been involved in so many matters at USPS that he isn't fully functioning as PostmasterGeneral.TangentDeJoy is currently under FBI investigation. He allegedly pressed employees at New Breed Logistics for donations to Republican candidates. DeJoy also allegedly used company bonuses to reimburse them. This could be considered an illegal straw-donor scheme.What to WatchDeJoy's financial ties to XPO, as well as the opposition to his USPS plans, could fuel Democrats' push to oust him from office. Rep. Gerry Connolly (D-Va.), tweeted Friday to respond to the Post report that DeJoy was a walking conflict-of-interest and that he should be fired. However, it is unlikely that a majority board member would vote to remove DeJoy. The board currently has a 5-4 majority of Democrats, Biden appointees (Amber McReynolds is the third Biden appointee). However, Bloom has publicly backed DeJoy, and Donald Moak, another Trump-appointed Democrat, has not shown any signs of wanting to vote against DeJoy.Continue readingDeJoy retains financial ties with former company, as USPS awards it a new $120 million contract (Washington Post).USPS Board Meeting Testy: Biden Appointees voice disagreements with DeJoys Vision (Government Executive).Unconventional USPS Plan to Slowen Mail Slammed by Postal Regulator (Forbes).Experts testify that Louis DeJoy, Postmaster General, Should Resign Due to Financial Conflicts Of Interest (Forbes).Louis DeJoy Resigns from a Former Company that Contracts with the Postal Service (Forbes).