United Co chairman and chief executive officer James McGlothlin told the Washington Post on Monday that the governor’s wife Maureen McDonnell was paid $36,000 last year to advise the Virginian coal company’s philanthropic arm.
The company is active in financial services, and oil and gas, and also owns golf courses and other real estate. Its primary subsidiary United Coal Co is the sixth largest metallurgical coal producer in the US and owns 17 mines in three states.
McGlothlin said the state’s first lady had advised both the company and his family on their charitable efforts. However, according to the Washington Post, the governor did not disclose this arrangement adequately in his financial reports.
The news comes as the governor is investigated by the FBI and state police for ties to Star Scientific Inc, a nutritional supplements maker, and its chief executive, Jonnie Williams, for unreported gifts and operational irregularities.
As an elected official in Virginia, McDonnell is legally required to disclose any employer that pays his wife $10,000 or more annually. He also must disclose whether he or Maureen are paid directors or officers of any company.
In his 2011 and 2012 financial statement, McDonnell listed his wife as a paid trustee of the family charity, the Francis G. and James W. McGlothlin Foundation.
However, McGlothlin told the Washington Post that Maureen McDonnell was never a member of the company’s board.
By listing his wife as a trustee, McDonnell did not have to disclose how much she was payed. McGlothlin confirmed the amount.
McGlothlin said the first lady’s pay was for a few days of work advising the company and its $21 million philanthropic foundation on its funding of educational and health care initiatives.
He said Maureen McDonnell never sought compensation and it was the company's decision to pay her.
"She definitely didn't ask," McGlothlin told the Washington Post.
"We said to ourselves: 'Hey, I wonder if she would help us with this? It'd be really ideal to have someone of her stature involved’."
McGlothlin said Mrs McDonnell also helped to connect the foundation with influential people in Richmond who might be interested in attending the foundation's charitable events.
Governor McDonnell has been an ally of the coal industry in the past, including supporting a 2012 bill in the General Assembly that extended a tax credit for coal companies for a further two years.
