Icahn Enterprises, CVR Energy and their related affiliates appear to be in violation of the Lobbying Disclosure Act of 1995 (LDA), according to a complaint Public Citizen filed March 8 with Congress. The complaint says there is no record of either entity's past or current compliance with the LDA.
Carl Icahn serves as chairman of the board of Icahn Enterprises and CVR Energy Inc. He controls 90% of Icahn Enterprises’ depositary shares, and Icahn Enterprises, in turn, owns 82% of CVR. Icahn Enterprises is a holding company engaged in an array of industries, including energy, investment, automotive, railcars, gaming, metals, mining, food packaging, real estate and home fashion.
On Dec. 21, 2016, President-elect Donald Trump named Icahn special adviser to the president on regulatory reform. Media reports have detailed Icahn’s advocacy within the Trump Administration to make changes to the existing Renewable Fuel Standard (RFS).
At the end of February, there was a scurry of activity when it appeared that Icahn had struck a “backroom deal” with Renewable Fuels Assn. (RFA) president and chief executive officer Bob Dinneen. The rumored executive order would shift responsibility -- known industry-wide as the "point of obligation" -- from larger, well-financed corporate refiners and importers to the smaller retail blending rack sellers. Besides RFA, the ethanol industry and other stakeholders such as the trucking and rail industries were in support of keeping the point of obligation as it current stands.
The changes would shift responsibility for blending ethanol and biodiesel from companies like Icahn’s CVR Energy oil refiners to wholesale gasoline distributors. CVR’s cost of compliance with the current RFS came to more than $200 million to purchase the needed credits last year alone.
“Icahn’s dual role as an owner of an oil refining business and Trump’s special adviser on regulations not only presents a significant conflict of interest, but Icahn’s failure to register himself and his affected businesses as lobbyists makes a mockery of our nation’s good governance laws,” said Tyson Slocum, director of Public Citizen’s Energy Program. “He vetted the eventual (Environmental Protection Agency) nominee, advised the president-elect on regulatory policy and is pushing the President to change policy so that his company can save hundreds of millions of dollars.”
The complaint concludes, “All of this has occurred with no record of any LDA filings by or on behalf of Mr. Icahn, Icahn Enterprises or CVR Energy. It is unlikely that all these activities occurred without some individual or entity being obligated to report lobbying activity under the LDA.”
Following the Feb. 28 reports of Icahn’s role, Public Citizen said the U.S. Department of Justice should “launch an immediate investigation into the role Mr. Icahn played during the transition and currently plays as a former adviser to president.”