Reed Calls for IG Probe into Commerce Sec’s ‘Buy Tesla’ Pitch
Senator seeks investigation into Secretary Lutnick urging a national television audience to buy a specific stock tied to Elon Musk that directly affects Secretary Lutnick’s personal financial holdings
WASHINGTON, DC – U.S. Senator Jack Reed (D-RI) is calling for an independent watchdog to investigate Commerce Secretary Howard Lutnick’s self-dealing call for Americans to buy Tesla stock.
On March 19, after Tesla’s stock price had fallen considerably over the previous month, Secretary Lutnick – whose Wall Street investment firm owns 739,920 Tesla shares and millions of options on Tesla stock — appeared on Fox News urging the public to buy Tesla stock. Lutnick said: “If you want to learn something on this show tonight, buy Tesla. It’s unbelievable that this guy’s stock is this cheap. It’ll never be this cheap again.”
Federal ethics rules explicitly prohibit officials appointed to the executive branch, such as cabinet members, from using their position to promote private businesses. And federal conflict-of-interest laws prohibit officials from taking actions using their public position to benefit their personal financial interests.
Senator Reed is asking the Acting Inspector General of the U.S. Department of Commerce and the Acting Director of the U.S. Office of Government Ethics to open a probe into whether Secretary Lutnick violated federal law barring public officials from promoting any “product, service or enterprise,” and seeking information about Secretary Lutnick’s compliance with Federal ethics rules and whether he or his family financially profited from the cabinet official unethically using his office to pump up the stock price.
“I write to urge you to open an investigation into Secretary of Commerce Howard Lutnick for encouraging viewers to buy Tesla stock during an appearance on Fox News,” Senator Reed wrote to the Commerce Department’s Acting Inspector General. “On March 19, Mr. Lutnick sat for an interview in his official capacity and told the American people, “If you want to learn something on this show tonight, it’s ‘buy Tesla.’ It’s unbelievable that [Elon Musk’s] stock is so cheap. It’ll never be this cheap again.” He also predicted that each American would be buying “a Telsa robot, and anyone who doesn’t buy a Tesla robot is going to be silly.””
Reed’s letter notes: “Such hucksterism appears to violate federal ethics rules, which bar federal employees from using their public office “for the endorsement of any product, service, or enterprise.” Additionally, his statements also appear to violate federal conflict-of-interest laws prohibiting federal employees from using their public office to support their personal financial interests because Mr. Lutnick’s Wall Street firm, Cantor Fitzgerald, has exposures to Tesla approaching $1 billion. According to Mr. Lutnick’s ethics agreement with the Commerce Department, he is obligated to divest his majority ownership stake in Cantor Fitzgerald within 90 days of taking office—by April 21. Federal regulations require Mr. Lutnick to publicly certify once he has divested, and such a certification has not been posted to the OGE website. But even when Mr. Lutnick fully divests, his children, whom Mr. Lutnick has installed as senior executives of Cantor Fitzgerald, will benefit from movement in Telsa’s stock price prompted by Mr. Lutnick’s public pronouncements.”
Secretary Lutnick did not appear to be going rogue when he made such an urgent and direct public call for viewers to purchase Tesla stock. Lutnick’s appearance came in the wake of President Trump turning the White House lawn into a Tesla showroom and pledging to buy a Tesla.
Since President Trump and Secretary Lutnick’s actions, Tesla stock prices have risen.
Reed’s inquiry to the acting inspector general comes months after President Trump carried out a significant purge of inspectors general across multiple federal agencies. On Friday, January 24, 2025, Trump fired independent inspector generals across most major federal departments, including the U.S. Department of Commerce.
Full text of the letter follows:
Mr. Roderick Anderson
Acting Inspector General
U.S. Department of Commerce
1401 Constitution Avenue NW
Washington, DC 20230
Mr. Douglas A. Collins
Acting Director
U.S. Office of Government Ethics
250 E Street SW
Washington, DC 20024
Dear Acting Inspector General Anderson and Acting Director Collins:
I write to urge you to open an investigation into Secretary of Commerce Howard Lutnick for encouraging viewers to buy Tesla stock during an appearance on Fox News.
On March 19, Mr. Lutnick sat for an interview in his official capacity and told the American people, “If you want to learn something on this show tonight, it’s ‘buy Tesla.’ It’s unbelievable that [Elon Musk’s] stock is so cheap. It’ll never be this cheap again.” He also predicted that each American would be buying “a Telsa robot, and anyone who doesn’t buy a Tesla robot is going to be silly.”
Such hucksterism appears to violate federal ethics rules, which bar federal employees from using their public office “for the endorsement of any product, service, or enterprise.” Additionally, his statements also appear to violate federal conflict-of-interest laws prohibiting federal employees from using their public office to support their personal financial interests because Mr. Lutnick’s Wall Street firm, Cantor Fitzgerald, has exposures to Tesla approaching $1 billion. According to Mr. Lutnick’s ethics agreement with the Commerce Department, he is obligated to divest his majority ownership stake in Cantor Fitzgerald within 90 days of taking office—by April 21. Federal regulations require Mr. Lutnick to publicly certify once he has divested, and such a certification has not been posted to the OGE website. But even when Mr. Lutnick fully divests, his children, whom Mr. Lutnick has installed as senior executives of Cantor Fitzgerald, will benefit from movement in Telsa’s stock price prompted by Mr. Lutnick’s public pronouncements.
In light of these statements, I ask that you open an investigation into Mr. Lutnick’s compliance with Federal ethics rules and the laws prohibiting conflicts of interest. To the extent permissible under the rules and regulations of your agencies, I also ask you publicly announce this investigation in order to discourage any potential violations of ethics rules by Mr. Lutnick or other members of the administration. Thank you for your attention to his important matter.
Sincerely,
