SACRAMENTO, Calif. (AP) – California's political watchdog said Thursday it is opening an investigation into whether a top aide to Gov. Jerry Brown properly disclosed her stock holdings in Pacific Gas & Electric Corp, but declined to launch an investigation into a more serious allegation that her holdings posed a conflict of interest.
The Fair Political Practices Commission said it will investigate a report alleging that Nancy McFadden, a former senior executive at PG&E, failed to disclose the timing and sale of her stock in the company. McFadden reported owning between $100,000 and $1 million in PG&E stock in her 2011 disclosure, but did not disclose until her 2013 filing that she sold the PG&E stock in 2012, the group's filing alleges. It says she also failed to provide a date or amount for the sale as required.
The FPPC investigation is not a finding of wrongdoing. Still, Consumer Watchdog president Jamie Court said the stock sale is a serious concern, because McFadden knew details the public did not about the investigation into the Sept. 9, 2010, pipeline explosion and fire that killed eight people near San Bruno.
"This was a volatile stock because of the San Bruno investigation, and she clearly had inside information as to how the investigation was proceeding," Court said. "This was a conspicuous lapse in the timing and reporting of stock sales."
Still, the commission said it did not find enough evidence in the 57-page report to consider the conflict-of-interest allegation against McFadden.
Evan Westrup, a spokesman for the governor, said all of the stock had pre-established vesting dates and was sold automatically, regardless of the stock price at the time.
"It's not surprising that the FPPC found these conflict of interest allegations totally baseless," Westrup said in an email to The Associated Press. He added, "We have already acknowledged inadvertent filing errors" and sent amended forms to clear up the issue.