Jurisprudence

Trump Appears Headed for Defeat in Effort to Block Congress From Subpoenaing Financial Records

Donald Trump outside.
Donald Trump in Washington on Monday.
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On Friday, a three-judge panel of the U.S. Court of Appeals for the D.C. Circuit heard argument in Trump v. Mazars, a case that will play a role in determining whether President Donald Trump’s financial records see the light of day. In Mazars, Trump is challenging the House Oversight Committee’s subpoena of financial documents held by the accounting firm Mazars USA LLP related to Trump and his businesses. Arguing that Congress should be blocked from subpoenaing these documents, Trump’s attorney made a couple of astounding arguments on Friday that, if accepted, would dramatically narrow Congress’ long-standing power to investigate. Thankfully, the judges on the D.C. Circuit did not seem to buy it.

The Mazars case implicates Congress’ power to investigate. The Supreme Court has long held that the scope of Congress’ investigatory power is coextensive with the scope of its power to legislate. As the court has explained, Congress’ power to investigate encompasses “inquiries concerning the administration of existing laws, as well as proposed or possibly needed statutes” and includes “surveys of defects in our social, economic or political system for the purpose of enabling the Congress to remedy them.” In short, Congress can properly investigate at least any area on which it can pass legislation.

Exercising that power, Rep. Elijah Cummings, chairman of the House Oversight Committee, subpoenaed various documents from Mazars USA related to Trump’s and his businesses’ finances from 2011 to the present. The committee’s request follows allegations that Trump may have omitted certain information on federal financial disclosures and that he may have certain conflicts of interest that could impair his ability to do his job free from influence. The question before the D.C. Circuit was whether the committee’s request for documents was legitimate—that is, whether Congress’ request is relevant to an “inquir[y] concerning the administration of existing laws” or “proposed or possibly needed statutes.”

As the oral argument on Friday made clear, Congress’ request is clearly legitimate. First, obtaining information about the president’s financial interests and any conflicts he might have would assist Congress in determining whether existing laws are functioning adequately, and whether they need to be updated. Specifically, the Ethics in Government Act of 1978—passed after the Watergate scandal—requires every federal official, including the president, to fill out financial disclosure forms regarding their income, property, and other financial information. (Every president since Nixon has complied with the law’s requirements.) That law is administered by the Office of Government Ethics, which provides guidance on disclosure requirements and investigates violations of the act.

As Judge David S. Tatel noted at the Mazars argument, Congress clearly has a legitimate basis for investigating whether the president complied with the act’s existing requirements and in what ways the act might be insufficient to address his (or any other federal official’s) various business and property interests. With that information in hand, Congress could better determine whether to add to the act’s requirements, increase the act’s penalties, bolster the Office of Government Ethics’ budget or resources, or otherwise change the act’s terms. Thus, Congress’ investigation of the efficacy of the Ethics in Government Act as it currently stands is sufficient in and of itself to justify the Mazars subpoenas.

Second, although Congress need not point to any proposed legislation to justify an investigation, there are actually a number of existing pieces of legislation to which this investigation relates. For instance, H.R. 1 would require the president to file a new financial disclosure report within 30 days of taking office and would prohibit the president from contracting with the United States government. Moreover, the bill would require the president to “divest of all financial interests that pose a conflict of interest” by converting those interests to cash or placing them in a blind trust, or disclosing information about them. Similarly, H.R. 745 would strengthen the Office of Government Ethics. Congress’ ongoing consideration of these pieces of legislation only underscores the legitimacy of its investigation.

Finally, this investigation could also guide Congress’ consideration of other remedial legislation, even if that legislation has yet to be proposed. As the Supreme Court has explained: Congress’ investigatory power “is as penetrating and far-reaching as the potential power to enact and appropriate under the Constitution.” Thus, for example, Article II, Section 1 of the Constitution provides Congress with the power to set the president’s salary. As Judge Patricia A. Millett noted at the Mazars argument, Congress could pass legislation that would tie the president’s salary to certain disclosure requirements or other prohibitions on conflicts of interest, and that would be well within its power to legislate. Or similarly, Congress could pass legislation that prevents federal agencies from using funds to pay companies with which the president has a financial interest. This type of legislation is clearly legitimate, and understanding Trump’s financial arrangements would obviously be relevant to deciding whether to propose such legislation.

At argument, Trump’s attorney put forward two main arguments in response to these legitimate legislative bases for the committee’s investigation, but neither was persuasive. First, his attorney argued that the D.C. Circuit should disregard these plainly valid legislative purposes because Congress’ actual purpose is to determine whether the president is complying with ethics laws—something that is an executive and judicial branch function, not a legislative branch function. But just because an investigation might have the potential to uncover violations of law does not mean that it therefore lacks a legitimate legislative purpose. As the Supreme Court has explained, Congress’ power “to require pertinent disclosures in aid of its own constitutional power is not abridged because the information sought to be elicited may also be of use in [the prosecution of pending] suits.”

Tatel offered a useful analogy at the Mazars argument: If Congress were investigating whether to bolster federal antitrust laws because it believed that they were insufficient to constrain big tech companies, no one would doubt its power to investigate Facebook’s compliance with existing antitrust laws. This would be true even if that investigation had the potential to uncover whether that company had violated current antitrust law.

Finally, Trump’s attorney made one additional argument: that every potential piece of legislation that might limit the president’s conflicts of interest or require the president to disclose his financial holdings would amount to a prerequisite to holding the office of president that would violate Article II, Section 1, Clause 1 of the Constitution—which delineates the qualifications for that office. This far-reaching proposition has no basis in Supreme Court case law, as an amicus brief my organization, the Constitutional Accountability Center, filed in the case explains. Indeed, the only source that Trump’s attorneys offer in support of this sweeping constitutional rule is a Justice Department letter from 1974, and even that letter does not stand for the proposition that all laws requiring presidents to disclose finances or conflicts, set up a blind trust, or otherwise arrange their financial holdings in a certain way upon taking office are unconstitutional. Indeed, under Trump’s argument, even the Ethics in Government Act as it currently exists would apparently be unconstitutional as applied to the president, despite every previous president to whom it applied having complied with it. That’s simply not right.

Judge Neomi Rao, the third judge on the panel, was the only judge that seemed to be skeptical of the Oversight Committee’s power to bring these subpoenas. However, her questions focused mainly on whether the full House had properly authorized the Oversight Committee to issue these subpoenas, perhaps indicating that even she did not believe that Congress lacked a legitimate legislative basis for this investigation.

In short, if Trump’s attorneys prevail in Mazars, the effects would not be limited to this case alone. Such a ruling would undermine congressional oversight as a critical component of our nation’s system of checks and balances. And it would undermine Congress as an institution, as well as our tripartite system of government more broadly. Thankfully, the D.C.
Circuit appeared to be skeptical of Trump’s far-reaching arguments.