Albert Kelly, a senior adviser at the Environmental Protection Agency, appears not only unqualified for the position he holds - his professional career has been in banking - but was also banned from the financial industry by the Federal Deposit Insurance Corporation (FDIC) for life.
Under Kelly's leadership, the family-run SpiritBank faltered and wound up taking millions in federal money that it failed to pay back.
The timing of Kelly's newfound employment is curious as well, because the longtime friend of EPA Administrator Scott Pruitt started his new role just two weeks after the FDIC fine was handed down and two months before the lifetime ban decision.
In May, the Federal Deposit Insurance Corporation fined Oklahoma banker Albert Kelly $125,000. According to a consent order, which The Intercept obtained through the Freedom of Information Act, the FDIC had “reason to believe that [Kelly] violated a law or regulation, by entering into an agreement pertaining to a loan by the Bank without FDIC approval.”
Two weeks later, EPA Administrator Scott Pruitt appointed Kelly to lead an effort to streamline the Superfund program. In July, the FDIC went further, banning Kelly from banking for life. The “order of prohibition from further participation” explained that the FDIC had determined Kelly’s “unfitness to serve as a director, officer, person participating in the conduct of the affairs or as an institution-affiliated party of the Bank, any other insured depository institution.”
The Intercept's investigation found little as to the specifics of Kelly's actions that resulted in his current situation, but the FDIC has been known to issue lifetime bans for bankers convicted of criminal fraud.
According to the order Kelly signed, his violation “of law or regulation, unsafe or unsound practice, and or breach of fiduciary duty” caused the bank financial loss or other damage. It had also involved his “willful or continuing disregard for the safety or soundness of the Bank.”
Kelly, whose family-owned SpiritBank has been around since the 1930s, worked for the institution for 33 years. The institution ran into trouble under his leadership and in 2009 accepted $31 million through the Troubled Asset Relief Program (TARP).
How did that turn out?
While most banks paid the Treasury back for the funds they’d gotten through the TARP program with interest, SpiritBank was unable to reimburse the government for more than $21 million of the $30 million it had received. Taxpayers lost 70 percent of the money they laid out for SpiritBank, making it one of TARP’s worst investments.
But Spirit Bank and Kelly had been a friend to Pruitt, lending to him on multiple occasions:
As head of the Superfund task force, Kelly was in charge of managing a program experiencing financial difficulties, making it all the more curious that someone banned from the banking industry would be a good fit for the job - not to mention his lack of scientific background.
Senator Elizabeth Warren (D-Mass.) has taken up the task of questioning Kelly's credentials and fitness for the role, sending Kelly a letter requesting more information following the Intercept's investigation:
“Given your troubled financial history, as well as your lack of experience in environmental policy and regulation, I am concerned that you served as Chairman of the Superfund Task Force and that you continue to serve as a Senior Advisor at the EPA,” Warren wrote in the letter, first reported by The Intercept.
As Warren noted, the program’s budget has been on the decline since 1999, and the Trump administration has proposed slashing it even further. “Given these financial struggles,” Warren wrote, “it is essential that the EPA personnel responsible for the Superfund program — including the personnel making recommendations on the Superfund’s future — are capable of properly managing and allocating the program’s finances.”
Kelly has until February 1 to respond to the 14 questions in Warren's letter.