Hill watchdog says Rep. Nehls may have used campaign funds for personal use

The Hill’s nonpartisan ethics watchdog found probable cause to believe Rep. Troy Nehls used campaign funds for personal use, according to a new report released Friday.

"[T]here is probable cause to believe that Rep. Nehls may have converted campaign funds to personal use by expending funds that were not attributable to bona fide campaign or political purposes," wrote the board of the Office of Congressional Ethics.

The investigation was disclosed in a report released Friday by the House Ethics Committee, which is evenly split between both parties.

The Texas Republican’s congressional campaign made periodic rent payments since the 2020 campaign cycle to a company, Liberty 1776 LLC, owned and operated by Nehls and headquartered at his home address, according to the report. The company's right to do business in Texas had been terminated by the state in 2022 for failing to pay taxes.

But his campaign listed a separate venue, “Freedom Hall,” as its headquarters. OCE wrote that it had been a bar or tavern later converted into an Islamic center and boarding school. No rent payments were directly recorded from the Nehls campaign to the venue or the entity that owned it.

Although campaign rules don’t prohibit lawmakers from providing services like rental space to their campaigns, they have to do so at fair market values. Nehls and his staff did not cooperate with the ethics investigation, according to OCE, leaving the watchdog without clarification from his camp.

Jerad Najvar, an attorney for Nehls, denied the allegations in a response released along with the report. The payments from Nehls’ campaign to Liberty 1776 LLC were for rent at the Freedom Hall location, Najvar wrote, which was used for campaign events and activities during the 2020 and 2022 cycles.

“While Respondent was a member of the LLC and established the entity, he took no salary and did not otherwise receive any profits from its operation,” Navjar wrote.

Nehls, in a statement, said he refused to cooperate with OCE because it was created under former Speaker Nancy Pelosi, but “my books remain open, and I am cooperating with the legitimate House Committee on Ethics.”