Cruz's Infamous Law-Breaking: Was It Worth The Risk?

Ted Cruz is an American Republican politician who was elected to the U.S. Senate in 2012 and began his first term representing Texas in 2013. Cruz is known for his conservative views and has a reputation as a firebrand. He has been involved in several controversies, including his role in the 2013 government shutdown and his attempts to overturn the 2020 presidential election results. In 2016, Cruz unsuccessfully ran for president and later endorsed Donald Trump, despite their contentious relationship during the campaign. Cruz has also faced criticism for his response to the 2021 winter storm in Texas and for spreading conspiracy theories about the 2020 election.

Ted Cruz's failure to disclose his financial relationship with Caribbean Equity Partners Investment Holdings during his 2012 campaign

In 2013, Time magazine reported that Ted Cruz might have violated ethics rules by failing to disclose his financial relationship with Caribbean Equity Partners Investment Holdings during his 2012 campaign for the US Senate. The relationship originated with a $6,000 investment Cruz made over a decade earlier in a Jamaican private equity firm founded by his college roommate.

Cruz later reported the financial relationship in 2013 but failed to comply with Senate rules requiring full identification of the holding company and its location, triggering an inquiry by the Senate Select Committee on Ethics staff and a second amended disclosure. After additional inquiries by Time, Cruz said he was in the process of making further corrections to his disclosure.

Cruz told Time that the initial failure to report the financial relationship was an oversight that he corrected in May 2013 on his own initiative in his first filing after his election to the Senate. He said the later amendment to the May filing was part of the normal interaction with Senate ethics committee staffers. He provided Time with copies of a number of relevant documents supporting his explanation of the incorrect disclosures.

Cruz's relationship with Caribbean Equity Partners stemmed from his long-time friendship with his college roommate, with whom he co-founded the company in 1998. Cruz took a large minority share in the company, according to the firm's articles of association.

Cruz says he has not had any relationship with the private equity firm since he cashed out his initial investment of $6,000 for a total return of $100,000 over a decade earlier. He provided Time with a copy of the promissory note, which gives the name of the holding company as CEP Investments Holdings Limited. Cruz says the agreement is effectively an IOU to him from his college roommate, who is the owner of the holding company.

Cruz says he failed to include the promissory note among his assets on his first financial disclosure in July 2012 when he was a candidate for the US Senate because he had forgotten about it. He said that in 2011, there was an inadvertent omission of this promissory note, and after a conversation with his college roommate, he remembered it. Cruz's initial filing was made in the heat of his campaign. He was fined $200 for filing the document late.

On his financial disclosure form for 2012, filed in May 2013, Cruz listed the promissory note and said he received no income from it or the company. Cruz identified the note as a non-publicly traded asset among other holdings, which he listed by their ticker symbols. Cruz said the asset was a "Promissory Note from CEP investments holdings LTD." Caribbean Equity Partners has no connection to Constellation Energy Partners, the American company with the ticker symbol CEP.

Cruz then received an inquiry from the Senate ethics committee staff about the listing, and he amended his filing to indicate the nature of the promissory note, the entity that had issued it, the city in which the entity was located, and the date the note had been issued. However, this filing also contained errors, misnaming the holding company, incorrectly saying it was domiciled in Jamaica, and giving the wrong date for the promissory note. In the filing, Cruz, a former lawyer and magna cum laude graduate of Harvard Law School, listed a wide variety of assets held jointly with his wife, including mutual funds and blue-chip stocks totalling between $1.5 million and $4 million.

Ted Cruz's failure to report nearly $1 million in low-interest loans from Goldman Sachs and Citibank to the FEC

In January 2016, The New York Times reported that Ted Cruz and his wife had taken out nearly $1 million in low-interest loans from Goldman Sachs and Citibank. The loans were not reported on Federal Election Commission (FEC) disclosure statements as required by law. Cruz did, however, disclose the loans on his Senate financial disclosure forms in July 2012.

The FEC concluded that Cruz's campaign committee had inaccurately reported that the candidate loaned himself just over $1 million in "personal funds", when in fact, the funds came from Goldman Sachs—his wife's employer—and Citibank. The FEC fined the 2012 Cruz Senate campaign $35,000 for this violation.

A spokesperson for Cruz stated that the failure to report the loans to the FEC was "inadvertent" and that he would file supplementary paperwork. Cruz also missed the deadline for repayment, intentionally, in order to challenge the law that only $250,000 in personal loans can be repaid with money raised after an election.

In May 2022, the Supreme Court ruled in FEC v. Ted Cruz for Senate, siding with Cruz and allowing him to ask donors to help repay $555,000 he loaned to his campaigns.

Ted Cruz's involvement in the 2013 US government shutdown

Ted Cruz, a Republican senator from Texas, played a leading role in the 2013 US government shutdown. He gave a 21-hour speech in the Senate in an attempt to hold up a federal budget bill and defund the Affordable Care Act (Obamacare).

Cruz's plan was to force Congress and President Barack Obama to defund Obamacare by threatening to shut down the government. He persuaded the House of Representatives and House Speaker John Boehner to include an ACA defunding provision in the bill. However, his plan was criticised by some other conservatives as "impossible".

Cruz's critics said that he offered only a fanciful theory that if the GOP flirted hard enough with a shutdown, Democratic lawmakers and the White House might lose heart and surrender. Grover Norquist, an influential anti-tax activist, likened Cruz’s strategy to a plotline in the satirical animated show “South Park”. Josh Holmes, a former aide to Senate Majority Leader Mitch McConnell, called it “like a toddler’s version of legislating”.

Cruz's gambit didn't work. Neither Senate Democrats nor Obama gave in on their cherished law. Instead, the government shut down for 16 days, and Republicans in Congress were blamed for it—including by other Republicans, who said they had distracted attention from the disastrous rollout of the HealthCare.gov website.

Cruz's speech, in which he read "Green Eggs and Ham" to his daughters via the C-SPAN feed, was the defining moment of a Senate tenure that has helped make him the favourite Republican presidential candidate for many conservatives. To those supporters, the shutdown signalled the depth of Cruz’s commitment to rein in government.

However, for many Republicans in Congress, this was the episode that soured them on Cruz. Many suspect that he always knew his plan would fail but went ahead with it anyway, expecting to benefit from the exposure. Former senator Tom Coburn said: "It wasn’t about the shutdown. It wasn’t about the Affordable Care Act. It was about launching Ted Cruz.”

Ted Cruz's role in the 2021 Capitol riots

On January 6, 2021, Ted Cruz voted to object to Arizona's and Pennsylvania's electoral votes, despite the Senate rejecting these objections by 93-6 and 92-7, respectively. In the lead-up to the Capitol riots, Cruz was a key figure in attempts to overturn the 2020 presidential election results. He was involved in Texas attorney general Ken Paxton's lawsuit, which sought to have the election results in four states nullified. Cruz also supported a plan to delay the January 6 electoral vote certification to allow Republican legislatures in six key states Biden had won to consider submitting slates of Trump electors, based on false allegations of widespread voting fraud.

Cruz has been accused of encouraging the Capitol riots through his rhetoric and attempts to overturn the election results. The Texas Democratic Party called for his resignation, stating that his efforts to block Biden's victory empowered the rioters. The Houston Chronicle and San Antonio Express-News also called for his resignation and expulsion from the Senate, respectively.

On the eve of the first anniversary of the attack, Cruz called the event a "violent terrorist attack", which drew sharp criticism from right-wing commentators and media personalities, including Fox News host Tucker Carlson. Despite attempting to downplay the incident, Cruz faced widespread condemnation from pro-Trump Republicans, including Matt Gaetz and Marjorie Taylor Greene.

Ted Cruz's controversial trip to Cancún during a brutal cold snap in Texas

In February 2021, Texas was hit by a historic winter storm, leaving up to 4.3 million residents without power and millions more without drinking water. In the middle of the crisis, Texas Senator Ted Cruz and his family were spotted on a plane to Cancún, Mexico, where they planned to stay at the luxury Ritz Carlton hotel.

Cruz initially said he was taking his daughters on a week-long vacation from school at their request, in an attempt to be a "good dad". However, he returned to Texas the next day, leaving his family in Mexico, and admitted that the trip was a mistake. He said that he had had second thoughts as soon as [they] left and understood why people were "upset".

Cruz's trip sparked outrage among both Democrats and Republicans, with some accusing him of appearing to use his daughters to deflect blame. Texas Democratic Party Chair Gilberto Hinojosa called on Cruz to resign or be expelled, saying:

> "Ted Cruz had already proven to be an enemy to our democracy by inciting an insurrection. Now, he is proving to be an enemy to our state by abandoning us in our greatest time of need."

However, some conservatives defended Cruz, with author and activist Brigitte Gabriel stating:

> "Senator Ted Cruz is one of the hardest working men in the country, he deserves a vacation."

Cruz's trip also raised concerns among other parents whose children attended the same school as his daughters, as the school's policy stated that students who travelled abroad could not return to classrooms for seven days after coming home.

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