Once again, the old axiom proves true.

The coverup is worse than the truth.

The House Ethics Committee has found Pennsylvania Rep. Mike Kelly (R-16) in violation of the chamber’s Code of Conduct during the committee’s investigation into his wife’s stock purchases for a company the congressman was focusing on in Washington.

The committee also said that the congressman and his wife should divest of all shares of steel manufacturer Cleveland-Cliffs before taking any further official action relating to the company.

The report cleared Kelly of intentionally causing his wife to trade based on insider information and having a conflict of interest, determining there wasn’t evidence to prove those two wrongdoings.

The panel, chaired by Rep. Michael Guest (R-Miss.), found Kelly, a member of the powerful Ways and Means Committee, breached the House’s code of conduct “by failing to meet his duty of candor.” The committee ordered he and his wife to divest their investments in Cleveland-Cliffs, the steel manufacturer at the center of the report.

“Representative Kelly’s conduct with respect to Cleveland-Cliffs and his wife’s stock purchase raised significant concerns for the Committee, even if it did not rise to the level of insider trading or clearly violate conflict of interest rules,” the committee wrote, later adding Kelly “has not demonstrated sufficient appreciation for the harm to the institution caused by the appearance of impropriety.”

Kelly, who has represented the 16th Congressional District since 2011, has been married to his wife, Victoria, since 1973, who, according to the report, has a trading account that is managed by a brokerage and was worth over $7 million in 2020.

In early 2020, Rep. Kelly and his staff worked for the implementation of Section 232 tariffs to protect the production of grain oriented electrical steel (GOES) in the United States. The only producer of GOES in the United States is AK Steel, which was acquired by Cleveland-Cliffs in early 2020, and is located in Butler, Pa. which is located in Kelly’s 16th District.

The controversy came later in the spring, as in March, Cleveland-Cliffs’ CEO publicly indicated that, without tariff protections, the company may close the Butler plant and lay off employees. On April 28, Cleveland-Cliffs opted not to close the Butler plant after Commerce advised the company that it would initiate a Section 232 investigation covering certain GOES-based steel products.

Representative Kelly’s staff was apprised of these developments by Commerce officials and Cleveland-Cliffs that same day. The next day, April 29, Ms. Kelly purchased 5,000 shares of Cleveland-Cliffs stock for $23,075. This purchase was disclosed in a periodic transaction report (PTR) filed by Representative Kelly on May 15, 2020.

The committee did not find substantial evidence that Rep. Kelly violated laws, rules, or other standards of conduct relating to insider trading and conflicts of interest. An expert commissioned by the OCC did conclude that “Ms. Kelly’s purchase of Cleveland-Cliffs stock on April 29, 2020, represented a sharp departure from her investment behavior, leading to the inference that this investment was due to some special event or consideration.”

Ms. Kelly’s typical trading activity relied “on her broker to identify trades,” while “unlike every stick she held since at least 2017 until the Cleveland-Cliffs purchase in 2020, this purchase required her explicit instruction.”

Rep. Kelly’s office provided a statement to the press that she was showing support for the local community. The Committee noted that there is no evidence that she was involved in crafting the statement nor that she informed anyone in the community about the purchase.

And an explanation was unable to be unearthed after Ms. Kelly refused to cooperate with the committee.

Ms. Kelly sold the stock in January 2021 and accrued a profit of more than $64,000.

When asked whether he had any concerns about the potential conflict of interest in working on matters related to Cleveland-Cliffs while his wife owned stock, Rep. Kelly responded, “My concern was more for the people I represent and the fact that there’s a lot of jobs that were at risk. I don’t think my wife buying a small amount of stock is going to drive any decision that I would’ve had.”

The committee report said that Kelly’s conduct raised significant concerns for the Committee, even if it did not rise to the level of insider trading or clearly violate conflict of interest rules. It criticized the congressman for his “failure to recognize the gravity of the allegations in this case and indicate a lack of respect for the Committee’s role and processes. Representative Kelly has not demonstrated sufficient appreciation for the harm to the institution caused by the appearance of impropriety.”