BGA: Pritzker Trust bought stock in a top Illinois contractor after he was elected Governor

CHICAGO — The blind trust set up to manage Gov. J.B. Pritzker’s vast wealth bought stock in one of the state’s biggest Medicaid contractors in 2020, the same year his administration made several decisions that benefited the company’s bottom line.

The purchase of stock in health insurance giant Centene Corp. was made on behalf of the billionaire governor by trustees at Northern Trust, appointed by Pritzker to independently manage his portfolio to separate those investment decisions from his role as the state’s most powerful elected official.

The investment in Centene — which collected more than $2.6 billion from state Medicaid contracts in the first half of 2021 alone — demonstrates the pitfalls of a blind-trust arrangement that still leaves the nation’s richest governor open to potential conflicts of interest.

The acquisition by Pritzker’s trust came despite his campaign pledge to purge his personal portfolio of companies holding state contracts. He also promised, as governor-elect, to make charitable contributions matching gains in his trust’s holdings from entities that hold state contracts.

The issue of stock purchases by elected officials is now being debated in Congress, which is considering an array of strengthened stock disclosure laws aimed at stopping lawmakers from profiting from their access to insider information. The stock holdings of judges and federal banking officials also have come under scrutiny.

Experts interviewed by the Better Government Association say the governor could have avoided the potential conflict by instructing his trust managers to refrain from investing in state contractors. Pritzker’s spokespeople declined to say whether he ever considered doing so.

“I don’t see why a trustee couldn’t operate within those bounds — especially given that he seems to have acknowledged the potential of a conflict with his pledge” to divest of companies that hold state contracts, said Eleanor Eagan of the Center for Economic and Policy Research, based in Washington, D.C.

Neither Pritzker representatives nor the managers of his trust would say how much the investment in Centene is worth to Pritzker’s bottom line. They also declined to say specifically when the stock purchase was made.

Asked whether the governor — after learning he became invested in one of the state’s largest contractors sometime during 2020 — took steps to recuse himself from decisions that directly affected the company’s finances, his spokeswoman said he has not.

“The governor is not involved in the contracting process related to Centene,” said Jordan Abudayyeh, Pritzker’s communication director. “There is nothing he would have to recuse himself from.”

She referred all other questions about the trust investment in Centene to Pritzker’s campaign officials.

Experts interviewed by the BGA said there is a conflict of interest if the state has contracts with a company in which the governor’s trust holds stock.

“Absolutely,” said Eagan. “I don’t really see how one can argue otherwise.”

The stock purchase was first disclosed May 3, 2021, four days after Pritzker signed his annual economic disclosure statement — a document detailing real and potential financial conflicts of interest that all state elected officials must fill out — listing Centene among more than 300 investments in 2020, each with a value of more than $5,000.

Pritzker, who is running for re-election this year, declined to be interviewed about the blind trust or the decisions he or his administration made that benefited Centene at a time when his personal wealth may have been affected by those decisions.

However, both his lawyer and a campaign spokesman said it would be unfair to suggest any connection between the decisions the governor has made as a public office holder and any boost to his personal fortune.

“Gov. Pritzker’s trust is blind,” said campaign spokeswoman Natalie Edelstein. “This means he is not a part of any decisions, nor does he have any information regarding any investments.

“He receives no regular reporting on what the trustees and investment advisors decide to purchase and plays no role in any investment decisions. Period,” she said. “Any reporting that would suggest otherwise ignores critical facts and would be grossly inaccurate.”

Pritzker’s attorney, Marc Elias, echoed that claim with an even stronger rebuke.

“The only information he received is a ready-to-file Statement of Economic Interest, which contains no values,” said Elias in a written statement to the BGA. “To suggest otherwise is not only inaccurate but potentially libelous.”