Political News

Two Top Aides to Pruitt Quit the EPA Unexpectedly

Posted May 1, 2018 5:05 p.m. EDT

WASHINGTON — Two top aides to Scott Pruitt, the Environmental Protection Agency chief who is facing an array of investigations related to his spending and management practices, have resigned amid widening scrutiny of their roles at the agency.

The departures include Pasquale Perrotta, who served as the agency’s chief of security and was the architect of the costly and unusual team of bodyguards and other protective measures provided to Pruitt — measures that critics have called unnecessary.

Also departing was Albert Kelly, a longtime friend of Pruitt’s and a former banker until receiving a lifetime ban from the finance industry last year following a banking violation. At the EPA, Kelly ran the agency’s Superfund program, which oversees the cleanup of hazardous waste sites.

The resignations of Kelly and Perrotta follow a string of reports of Pruitt’s lavish spending and alleged conflicts of interest, including his office’s illegal purchase of a secure telephone booth, his condominium-rental agreement with the wife of an energy lobbyist, and accusations that he demoted or sidelined EPA employees who questioned his actions.

Pruitt, who is the subject of 11 federal investigations, is seeking to establish a legal-defense fund, according to people familiar with his plans, who spoke on condition of anonymity. These people said they expect Pruitt to operate the fund privately, with no EPA affiliation. Administration officials often start such funds when they incur legal fees, soliciting friends and associates to contribute.

When asked about the fund, Jahan Wilcox, an EPA spokesman, said, “EPA does not set up a legal expense fund for any employee.”

The departures of Perrotta and Kelly also come as some of Pruitt’s top staffers privately express a growing frustration with his stewardship of the agency. When asked at a congressional hearing last week about the spending and the ethical questions hovering over his tenure, Pruitt denied knowledge of the decisions, blaming them instead on his senior staff.

As the investigations into Pruitt have grown, so has scrutiny of Perrotta and Kelly. Pruitt on Tuesday praised his two former aides, while Democrats seized on their resignations to renew calls for Pruitt to step aside.

“Scott Pruitt should be the next to go,” said Rep. Don Beyer, D-Va. “Albert Kelly was never qualified to run Superfund, his banking ban was a huge red flag,” he added.

Perrotta, known as Nino, is a former Secret Service agent with a background investigating the Gambino crime family.

Officially, Perrotta led Pruitt’s protective detail, but he played a larger role at the EPA by arguing that the security needs of the agency justified some management, personnel and spending decisions at the agency. Perrotta’s influence placed him at the center of inquiries by the EPA inspector general’s office into excessive spending and possible violations of contracting rules by Pruitt’s administration, according to senior officials at the EPA, who spoke on condition of anonymity for fear of retribution.

It was Perrotta, those people said, who pushed for the construction of the $43,000 surveillance-proof telephone booth in Pruitt’s office in Washington, over the objections of colleagues who had advocated a less expensive option.

Of Perrotta, Pruitt said: “Nino Perrotta has selflessly served the American people for more than 23 years, beginning his career as a special agent with the United States Secret Service and then serving four EPA administrators. His hard work and dedication will be missed by all those who worked with him.”

The House Oversight Committee is scheduled to interview Perrotta on Wednesday, as part of its investigation into Pruitt’s alleged ethical lapses. That will mark the first transcribed interview by that committee with an EPA official in the Trump administration, but the panel plans to summon five other current and former senior agency officials for such interviews in the coming weeks, including Pruitt’s chief of staff, Ryan Jackson, and a former top policy adviser, Samantha Dravis, both of whom Pruitt last week blamed for making some of the ethically questionable decisions of which he stands accused.

Kelly, widely known as Kell, was a longtime business associate of Pruitt’s in his home state of Oklahoma. Kelly, the former chief executive of the Oklahoma lender SpiritBank, had come under scrutiny for a banking violation that led to a lifetime ban from the finance industry last year. He has not disclosed why, though an order from the Federal Deposit Insurance Corp. said there was “reason to believe” he was illegally involved in “an agreement pertaining to a loan.”

Pruitt said that Kelly “will be sorely missed,” adding, “In just over a year he has made a tremendous impact on EPA’s Superfund program, serving as chair of the Superfund Task Force and presiding over the development of the steps necessary to implement the recommendations in the report.” Pruitt had also been questioned about his financial ties to Kelly’s bank during his Oklahoma years. SpiritBank provided the mortgage for a stately home Pruitt acquired together with other investors, using a shell company, in Oklahoma City in 2003. Pruitt did not mention the acquisition, detailed in a recent New York Times story, in his financial disclosures at the time.

SpiritBank also provided financing for a stake in a minor league baseball team that Pruitt acquired, along with others, in 2003, as well as Pruitt’s home purchase in suburban Tulsa the following year.

At the EPA, Kelly oversaw the Superfund hazardous waste cleanup program, where he has pushed for more intensive cleanups of contaminated sites to pave the way for investment on the reclaimed land by private developers.

Last month, Kelly acknowledged the scrutiny he has faced during an interview with The Montana Standard. “I get this tagline, ‘banker banned for life,'” he said.

“My problem with the FDIC emanated from one singular transaction in 2010. They didn’t like it. The bank didn’t lose any money. The bank made money. There was nothing untoward about it,” Kelly said, adding that he “ran out of money” to oppose the FDIC. “There are two sides to the story and mine rarely gets out there,” he said.

Last week, a member of Congress pressed Pruitt about whether Kelly should disclose details of his “lifetime banking ban as a matter of transparency.”

Pruitt responded: “I think Mr. Kelly, if he’s willing to share that with you, he should do that.”

The EPA, in response to questions submitted by The Times, has also said that Pruitt’s business dealings with Kelly were “ethical” and that the administrator’s stake in the shell company was “a simple real estate investment.”