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Eleven of the most troubling allegations in the House ethics report about Rep. Santos

The House Ethics Committee released the findings of its monthslong investigation into Rep. George Santos (R-N.Y.) on Thursday.  (Jabin Botsford/The Washington Post)
By Mariana Alfaro and Maegan Vazquez Washington Post

House investigators found “substantial evidence” that Rep. George Santos (R-N.Y.) knowingly violated ethics guidelines, House rules and criminal laws, according to a report released by the House Ethics Committee on Thursday.

After the report was released, Santos – who has for months faced demands to resign from several of his House colleagues – announced that he would not seek re-election next year.

The 56-page report details a sweeping array of alleged misconduct. According to investigators, Santos allegedly stole money from his campaign, deceived donors, reported fictitious loans and engaged in fraudulent business dealings. The congressman, the report alleges, spent hefty sums on personal enrichment, including visits to spas and casinos, shopping trips to high-end stores, and payments to a subscription site that contains adult content.

The report frequently cites Santos’ dealings with his former treasurer Nancy Marks – who last month pleaded guilty to filing false reports with the Federal Election Commission. Earlier this week, an aide to Santos pleaded guilty to a federal charge of fraud in connection with a scheme that included impersonating the then-chief of staff for former House speaker Kevin McCarthy (R-Calif.) to attract donors to Santos’ campaign.

Santos faces nearly two dozen federal charges, including allegations of defrauding his donors, using their money for his personal benefit and stealing the identities of family members and using donors’ credit cards to spend thousands of dollars. He has pleaded not guilty to all charges.

The House Ethics report details evidence to support a lengthy list of allegations. Here’s some of what investigators found:

1. Santos boasted about family wealth. In reality, investigators say he was frequently broke.

Santos’ personal finances, the report found, were “drastically different from what he disclosed” on his financial statements, and “even more irreconcilable with the narrative he broadcast to his constituents, campaign supporters, and staff.”

While Santos would boast about “significant wealth” and claimed to have access to a trust managed by a family firm, the report alleges that Santos was “frequently in debt, had an abysmal credit score, and relied on an ever-growing wallet of high-interest credit cards to fund his luxury spending habits.”

In a particularly scathing section, investigators noted that Santos, throughout both of his campaigns, claimed he had a background in finance and wealth management. “That background was largely fictional,” the report states. Had Santos filed accurate financial statements, the investigators wrote, “his constituents may have had cause to question whether he was actually ‘good at’ money management and growth, or balancing costs and budgets – or, indeed, whether he had any experience in finance at all.”

At one point, the report says Santos texted a staffer that Treasury Secretary Janet L. Yellen was proposing changes that would end up “taxing people like me to death.”

He was referring to the Biden administration’s proposal to tax “unrealized gains taxable income” – meaning, taxes that would primarily impact the ultrawealthy.

2. Campaign funds are alleged to have been used for Botox and shopping at luxury stores.

The report accuses Santos of having repeatedly funneled money through his campaign, a PAC and LLCs under his purview toward paying for personal expenses.

The committee identified expenditures at spas and cosmetic clinics that “could not be verified as having a campaign nexus.” On two occasions, the expenses were noted as “Botox” in spreadsheets that Marks gave the committee.

Other funds, sent by contributors intending to bolster his political candidacy, appear to have been used to “pay down personal credit card bills and other debt, make a $4,127.80 purchase at Hermes and for smaller purchases at Only Fans, Sephora and for meals and for parking.”

3. Santos allegedly lied to donors about his 2020 campaign loans – and then failed to pay a staffer for months.

Investigators found that, during his unsuccessful 2020 campaign for a House seat from New York, Santos reported “fictitious loans to his political committees to induce donors and party committees to make further contributions to his campaign – and then diverted more campaign money to himself as purported ‘repayments’ of those fictitious loans.”

Santos benefited politically and financially from the fake loans, the report alleges, which helped him inflate his 2020 campaign’s final cash-on-hand totals, which he then reported to the FEC. In his July 2020 FEC quarterly filing, Santos reported having $73,355.64 on hand. In reality, he only had $13,761.88. Per the report, Santos made only one of six of his reported loans.

“The reality was that the campaign did not have the funds to pay outstanding debts,” the report states. These debts included staffers’ paychecks – per the report, at least one of them went eight months without being paid for his work.

The Santos campaign also reported “repayments” for five of the six personal loans – four of which investigators say were never made. While Santos denied to investigators that he was aware of these fictitious loans – he blamed Marks for the bad bookkeeping – according to the report, evidence shows that he texted Marks about at least one of the fictitious loans. In total, the report says Santos was “reimbursed” for $29,200 in loans that he never made.

4. Santos’ campaign staff saw him as a “fabulist” and urged him to seek treatment.

Per the report, Santos “sustained all of this through constant lies to his constituents, donors, and staff about his background and experience.” But members of his own staff viewed him as a “fabulist,” whose “penchant for telling lies was so concerning that he was encouraged to seek treatment.”

Members of Santos’ campaign prepared a 141-page “Vulnerability Report” on him, which they showed him on December 2021, according to the ethics report. It noted, among other things, that there was “no evidence” to support his claims that he graduated from New York University with an MBA, or that he graduated from Baruch College with a bachelor of economics and finance. The report also raised questions over his finances.

“As a result of the report, Representative Santos was encouraged by his campaign staff to drop out of the race and, when he refused, three staffers quit his campaign altogether,” investigators wrote.

5. In 2022, Santos allegedly faked campaign loans again, this time for even larger sums.

In June 2021 and March 2022, Santos reported having loaned his second campaign $80,000 and $500,000 respectively. According to the investigation, “Santos did not have sufficient funds in his bank accounts to loan his campaign those amounts.” He, once again, inflated the numbers in his filings to the FEC.

Marks pleaded guilty last month to conspiring to defraud the government and admitted that she had a role in misreporting the $500,000 loan. As a result, House investigators concluded that Santos actively took part in the scheme.

6. The campaign is alleged to have made unidentified transfers and deposits – including one for $20,000, part of which was used to shop at Ferragamo.

Per the report, Santos’ campaign made a transfer of $20,000 to the congressman’s Devolder Organization. According to investigators, in the week the transfer was made, the money was used to make about $6,000 worth of purchases at the luxury store Ferragamo. Another $800 was withdrawn at a casino ATM, and $1,000 was withdrawn from an ATM near Santos’ apartment. Some of the money was used to pay for the congressman’s rent, according to the report.

Investigators say thousands also were transferred from the campaign to RISE – a state PAC that Santos managed alongside his sister, Tiffany, and Marks. In early 2022, the campaign transferred about $44,000 to the PAC. This money was not reported to the FEC.

7. Santos’ campaign falsified information related to campaign contributors’ names.

Marks’ plea agreement included testimony about a conspiracy between her and Santos to falsify information about donors. In agreement with Santos, Marks said she “filed a list of false donors with the FEC on the year-end 2021 report knowing it was not true, and the donors, who are the real people, didn’t give (her) permission to use their names.” Per Marks, this was done to “obtain money for his campaign by artificially inflating his funds to meet thresholds set by a national political committee.”

8. Santos allegedly spent large sums of the misreported campaign money on pricey travel and meals.

Per the report, Santos’ campaign “incurred significant travel expenses for flights, hotels, Ubers, and meals.”

Witnesses affiliated with the campaign gave investigators “conflicting” testimony regarding the congressman’s out-of-district travel, with some saying there were only two trips taken out of state during the campaign, and another saying Santos traveled “once per month.” A staffer said they often worried about “the look of the campaign spending all this money on … all these dinners and travel outside of the district.” Another staffer said Santos “was definitely a high roller.” Per the report, Santos spent nearly $4,000 in campaign funds at resorts and spas in July 2022, despite not having any campaign-related events listed on his schedule near any of the places where he was staying.

Also that month, Santos spent more than $3,000 at an Airbnb, which he reported to the FEC as a “hotel stay.” Investigators, upon reviewing his campaign calendar, found that those days had been written off as Santos being “off at (the) Hampton’s for the weekend.”

In December 2021, investigators say Santos placed taxi and Las Vegas hotel charges on his campaign credit card – at the time, Santos had told his campaign staff that he was on his honeymoon and would not hold campaign events.

9. Santos repeatedly ignored his campaign staffers’ warnings that something was wrong with the bookkeeping.

Per the report, Santos said he wasn’t aware of issues with his campaign’s FEC reporting until it was too late. But multiple witnesses told investigators that they voiced concerns about Marks’ bookkeeping directly to him. “But we didn’t receive a satisfactory answer,” a former staffer told investigators. “It was just, well, I’ll have to check with Nancy, get clarification on that.”

10. Santos told investigators he does not own any property.

Although Santos in a financial disclosure in 2022 reported four assets – including an apartment in Rio de Janeiro valued between $500,001 and $1,000,000 – he told the committee through his counsel that he “does not and has never owned real property.”

Santos, the report states, “commonly claimed to own property, not just in Brazil but also in New York and Florida. During his 2022 campaign, Representative Santos claimed to own 13 rental properties and discussed how the pandemic-era eviction moratorium affected him as a landlord.”

11. Santos is accused of failing to report some income in his taxes.

According to the report, Santos filed a late tax return in 2021 reporting a negative $70,481 in total income – claiming he had suffered more than $90,000 in business losses and received $20,304 in unemployment compensation. While he claimed the losses were primarily because of payments made to a company owned by one of his campaign consultants, in reality, those payments were made in 2022, not 2021.

Investigators say Santos also failed to disclose his unemployment income and income from Harbor City Capital, a now-defunct Florida-based investment firm that the SEC has described as a “fraud.” Santos also is accused of failing to report in his taxes unearned income from other assets, including more than $20,000 in stock transactions. Despite claiming in his taxes that he had a negative salary in 2021, in credit card applications, Santos claimed to have an income of $9,000 per month.

Intentionally failing to report income in a tax return can result in criminal charges.