All or most of a $267,000 loan obtained by Supreme CourtJustice Clarence Thomas to buy a high-end motorcoach appears to have been forgiven, raising tax and ethics questions, according to a new report by Senate Democrats.
Anthony “Tony” Welters, a longtime friend of Thomas who made the loan in 1999, forgave the debt after nine years of what he called interest-only payments, says the report, which was released Wednesday by Democrats on the Senate Finance Committee.
The loan’s existence was first reported during the summer by the New York Times. Committee Democrats undertook their inquiry following the Times’ story.
Thomas, 75, has been at the center of a heightened focus on ethics at the Supreme Court over his undisclosed travel and other ties with wealthy conservative supporters. The court, the only part of the federal judiciary with a formal code of conduct, is debating whether to adopt an ethics code and, in recent months, three justices have voiced their support for such a move.
Thomas borrowed the money from Welters, a healthcare executive, to buy a 40-foot refitted tour bus in which he tours the country with his wife, Ginni. Thomas has talked about staying in Walmart parking lots and RV parks, which are “what the neighborhoods used to be like.”
At the time of the loan, Thomas said in a handwritten note on his Supreme Court letterhead that agreements to pay interest of 7.5% a year and repay the money in five years, the report says. In 2004, the time to repay the loan was extended until 2014.
Documents voluntarily provided by Welters to the committee show that he forgave the loan in 2008, the report says. Welters gave the committee a copy of just one payment of $20,042 that Thomas made, in 2000.
“Welters forgave the balance of the loan to Thomas in recognition of the payments made by Thomas which Welters characterized as interest only payments that exceeded the amount of the original loan,” the report says. Nine years of interest-only payments would total roughly $180,000, considerably less than the loan amount. Welters did not explain the discrepancy.
Forgiven or canceled debt counts as income for tax purposes, the report says. In addition, Thomas has never included forgiven debt in his annual financial disclosures.
“Justice Thomas should inform the committee exactly how much debt was forgiven and whether he properly reported the loan forgiveness on his tax returns and paid all taxes owed,” Sen. Ron Wyden, D-Ore., the committee chairman, said in a statement.
There was no immediate response from Thomas to a request made through a court spokeswoman.
A series of reports from the investigative news site ProPublica revealed that Thomas has for years accepted, but not disclosed, luxury trips and other hospitality from Republican megadonor Harlan Crow.
Crow also purchased the house in Georgia where Thomas’s mother continues to live and paid for two years of private school tuition for a child raised by the Thomases.
Earlier this year, Thomas did report three private trips he took at Crow’s expense in 2022, after the federal judiciary changed its guidelines for reporting travel. He did not report travel from earlier years.
ProPublica reported that Justice Samuel Alito also failed to disclose a private trip to Alaska he took in 2008 that was paid for by two wealthy Republican donors, one of whom repeatedly had interests before the court.
The Associated Press also reported in July that Justice Sonia Sotomayor, aided by her staff, has advanced sales of her books through college visits over the past decade.
