A White House position could cost Peter Thiel more than he’s willing to give up

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One week after the election, President-elect Trump’s White House staff is still being formed, but one familiar name has already surfaced: Peter Thiel. The PayPal co-founder has become one of the most controversial figures in Silicon Valley, thanks to his unusual and often alarming political views, as well as a recently revealed crusade to bankrupt Gawker Media through frivolous litigation, waged secretly over the course of a decade.

Most recently, Thiel caused a stir in tech circles with his outspoken support for Trump, expressed through a $1.25 million donation to the campaign as it hit a low point in October. With Trump’s transition team now assembling the incoming cabinet — and Thiel playing an active role in that transition — the candidate seems poised to return the favor.

Thiel would come to government service with a web of conflicts

But putting Thiel in a White House position would be more complicated than it sounds — and could cost the eccentric billionaire more than he’s willing to give up. Thiel would be coming to government service with a web of conflicts from the private sector, including dozens of board memberships and early-stage investments in companies like SpaceX and Airbnb. He’s also the chairman, co-founder, and primary shareholder of Palantir, a secretive data-mining firm with tens of millions of dollars in government contracts. The nature of venture capital makes it unusually difficult to sever those ties cleanly. That doesn’t mean a Thiel appointment would be impossible — but it would raise difficult conflict-of-interest questions, and it’s anyone’s guess how Trump would respond.

The most immediate problem is Thiel’s membership on a number of boards of directors, particularly at Facebook, Zenefits, and as chairman at Palantir. Those directorships are a major part of his power within the tech world: they allow Thiel to influence investments and strategy at some of the industry’s most powerful companies. But from a government ethics perspective, each one is a conflict of interest. The law clearly prohibits federal employees over a certain pay grade from outside employment — and Thiel will most certainly clear that pay grade. Another law forbids participating in any decision with a predictable effect on the finances of an organization where you sit on the board, even if the board position is unpaid. (Notably, both the president and vice president are exempted from those laws.)