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Clarence Thomas, his luxury R.V., and his magical mystery disappearing loan
A justice who cared about ethics would want to resolve the questions surrounding the loan immediately — particularly if there were an answer.
The latest news on Justice Clarence Thomas’s disregard for ethics is a remarkable affront to the Supreme Court, his colleagues, and the country.
The Senate Finance Committee announced this past week that it had obtained information that Thomas “never repaid a substantial portion” of a $267,230 loan given to him by a wealthy friend, Anthony Welters, to enable the justice to purchase a luxury R.V.
Why is this revelation such an affront?
After all that has come out over this year about Thomas’s questionable practices and failed disclosures (at best), Thomas did something rather unusual when he filed his 2022 financial disclosure form (late) in August: He included more than 1,300 words of “additional information or explanations” for his form — which included updates on items “inadvertently” left out of past disclosures. He also had hired an outside lawyer, Elliot S. Berke, to assist with the disclosure — and who released a politicized statement in addition to Thomas’s explanation.
The Times story got some information about how Welters helped to make Thomas’s purchase of the R.V. possible:
But, it also detailed significant unanswered questions:
We now know more about that — thanks to the Finance Committee investigation — but, before I go further, I just want to highlight that Thomas’s disclosure form, with its long “additional information” section, was filed four days after the R.V. story was published, on Aug. 9.
There was nothing in the disclosure or Berke’s statement about the R.V. loan.
In the initial R.V. report in the Times, Thomas provided no comment — but the Times did highlight the ethics question this raised:
Fast-forward to this past week when the Senate Finance Committee released its information on the loan.
In a memorandum from the committee’s Democratic staff to committee Chair Ron Wyden, they detail information provided to the committee from Welters, including the terms of the loan; conclusions they drew from that information about the loan and repayment, such as there was; and the implications of their findings. It is astounding:
While additional documents pertaining to the loan agreement may exist, documents reviewed by Democratic staff suggest that Justice Thomas did not repay a significant portion of the loan principal. In fact, none of the documents reviewed by Committee staff indicated that Thomas ever made payments to Welters in excess of the annual interest on the loan.
Forgiveness of the loan results in a taxable event for Justice Thomas. Under tax rules, forgiveness of the entire principal by Welters requires Justice Thomas to include up to $267,230.00 in taxable income and report the amount on his tax filings. Justice Thomas did not disclose this forgiven debt on his ethics filings, raising questions as to whether Thomas properly reported the associated income on his tax returns.
This, in and of itself, would be shocking behavior for a justice — but Thomas’s failure to address this at all in his financial disclosure dated Aug. 9 makes it outright offensive. (As the committee memo also makes clear, there could be tax implications for Thomas of this beyond the ethics questions.)
When The New York Times’s Jo Becker followed up, Thomas’s lawyer — the same one who issued the external statement when Thomas’s disclosure was released — responded with a statement that really says nothing.
What’s remarkable here is not just Thomas’s behavior, it’s that he makes it plainly and abundantly clear that he does not believe he should have to justify it to anyone. If the loan was not “forgiven,” what happened to it? The only clue we has so far is a handwritten note from Welters, which the committee memo summarized as such:
It appears from the public information available that Thomas was likely only paying the interest on the loan (and there’s not even solid evidence that he did that). If that is so, then Welters stopping repayment after 2008 was far outside of the loan’s terms — and certainly not at all what would have happened under a traditional loan. If it’s not, and he paid off any substantial part of the principal, why is neither Thomas nor Welters saying so?
So, what is it? What happened? A justice who cared about ethics would want to resolve such questions immediately — particularly if there were an answer.
There’s much more compelling information about this story in Becker’s two reports. Check them out.
I wanted to write about this tonight to focus in on the fact that even after all of the criticism that Thomas has faced this year, after he hired outside help and spent extra time preparing his financial disclosure, and after he addressed past omissions in this year’s disclosure, he still decided to go forward with filing that disclosure four days after the R.V. loan story came out without addressing it in any way.
Honestly, though, I can hardly claim to be surprised about this. As I wrote here about Thomas’s August disclosure:
Notably, Thomas stated in the “explanations” section that he “continues to work with Supreme Court officials and the Committee staff for guidance on whether he should further amend his reports from any prior years.” So, he took these extra months, released a lengthy statement along with the report, and gave himself an out for this report still being incomplete by telling us that more “supplemental information” … could be forthcoming later.
Since the initial Pro Publica report about Thomas’s actions setting off this year’s stories was published on April 6, several justices have said they expect the court to take steps to adopt a code of ethics.
They have not done so yet, and it is hard to imagine how — in the absence of a legal obligation to do so — they will be able to get Thomas to agree to any changes of substance.
Thomas’s handling of the R.V. loan questions makes clear that not only does he not care about the public’s view of his ethical standards — but he also doesn’t care about the effect that his behavior has on the rest of the court.
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