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Shaheen support, ties to breast cancer research scrutinized

Senator Jeanne Shaheen.

Jim Col/AP

Senator Jeanne Shaheen.

Senator Jeanne Shaheen has been a strong advocate for spending government money to fight breast cancer. The New Hampshire Democrat has signed letters since she entered the Senate five years ago seeking $150 million to maintain a Defense Department breast cancer research program — despite objections by some other lawmakers — and last year, she endorsed an initiative to “end breast cancer” by 2020.

But Shaheen has also had a family financial stake in the research. In 2009, her husband, William, became an adviser to a Southern California startup, Ultrawave Labs Inc., that was developing new imaging technology to detect breast cancer and acquired stock options in the firm.

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That same year, Ultrawave received $78,000 in federal stimulus funding and later paid a Washington company to lobby both houses of Congress and several government agencies, including the Department of Defense, on breast cancer funding, dovetailing with the senator’s own work to support the Pentagon’s breast cancer program. The stimulus money was from the National Science Foundation, not the Department of Defense.

The Shaheens declined multiple requests for interviews and would not answer most detailed questions about their investments and connection to the firm. In a statement, the campaign said William Shaheen has not been an adviser to the company “for several years.” The campaign said that they recently learned that Shaheen’s stock options have since expired, so he did not wind up profiting from the transaction. The campaign would not disclose when the stock options expired.

Jeanne Shaheen’s Senate office also pointed to the Democratic lawmaker’s history of advocating for women’s health dating back decades, including a law she signed as governor requiring insurers to cover reconstructive surgery after a mastectomy.

Senate rules do not explicitly bar members from voting on items related to their own or family investments — except for earmarks or other legislation that only benefits a handful of people.

“As a public official, she, as always, abides by the letter and the spirit of the law, in disclosure, in avoiding conflicts of interest and in fulfilling all her responsibilities,” campaign spokesman Harrell Kirstein said in a statement.

Ultrawave also played down the issue.

“Jeanne Shaheen had no role and no involvement in the company,” Robert P. Hart, an Ultrawave attorney, said in an e-mail. Neither Jeanne nor William Shaheen was “asked to provide or provided any help or support in obtaining any government funding.”

A government ethics watchdog said such relationships present issues that voters should consider.

“It absolutely is a concern,” said Charlton Copeland, former chair of the Miami-Dade Commission on Ethics and Public Trust and a professor at the University of Miami. “It raises questions because so much of the work of this kind of policymaking takes place outside of the specter of the public eye.”

Shaheen, a former governor who has spent most of her career in public service, listed no assets of her own beyond her savings and checking account on her financial disclosure form filed with the Senate. The campaign said the family home in Madbury is under her name.

But her family has a diverse range of business interests.

Shaheen’s husband, a former US attorney, is a partner in one of the most politically connected law firms in New Hampshire. He also serves as chief executive for a small software company, and owns stakes in several commercial properties and businesses, including a hair salon. He also has occasionally become the lender of last resort for some desperate New Hampshire residents.

Though many politicians are wealthy, some have taken steps to avoid potential conflicts by turning over their investments to an outside adviser or setting up a blind trust. Former US representative Barney Frank told audiences that he only invested in Massachusetts municipal bonds because he could never be accused of a conflict of interest for trying to help his home state.

A Washington Post study in 2012 found that dozens of members of Congress sponsored or cosponsored legislation that could benefit themselves or family members. Such moves can sometimes become issues in campaigns.

“Whenever someone — a member or a spouse — has a significant number of investments, certainly that can increase the potential for a question about a conflict,” said Robert L. Walker, a former chief counsel and staff director of both the Senate and House ethics committees whose law firm, Wiley Rein LLP, predominantly represents Republicans.

But the law rarely requires members to recuse themselves or sell their interest in investments, he said.

The Shaheens declined to estimate their net worth, though their financial disclosure form indicates they have assets worth between $3.7 million and $7.9 million (not counting the value of their home) and liabilities of between $2 million and $4.2 million.

In tax returns released Tuesday, the Shaheens reported they earned just over a half-million dollars last year, far more than the median household income of $65,000 in New Hampshire but not unusual for sitting senators or candidates. Former Massachusetts senator Scott Brown, who is seeking the Republican nomination to face off against Shaheen in the November election, released tax returns last week indicating that he earned $474,000 last year.

The Shaheen campaign said the couple’s investments are generally listed in William Shaheen’s name alone because “he makes all decisions on and controls those investments and interests.”

Both Democrats and Republicans have made personal finances a key issue in the New Hampshire Senate race by attacking Brown for his ties to a controversial Florida penny stock and for obtaining an extension to file his own financial disclosure form.

Brown released eight years of tax returns last week, and also filed his financial disclosure form with the Senate.

Shaheen has started to face questions about her husband’s business, including his law practice.

The firm, Shaheen & Gordon, has a government relations arm and set up a “stimulus opportunities team” in 2009 to help clients grab a share of the American Recovery and Reinvestment Act passed that year to help jump-start the economy.

Republicans have pointed out that Shaheen voted for the stimulus, and have challenged the stimulus business venture as a conflict of interest. The firm, in a statement released by the campaign, said the stimulus practice was short-lived, had no clients, and that William Shaheen was not involved in it.

But public records show that Shaheen has a lengthy list of other interests that have garnered less attention.

In 2004, Shaheen and some friends began investing in another startup, JID Software Partners LLC, which goes by the name NextChoice and markets kiosk software to help customers place their own orders, said Tom Polcaro, the company’s president.

Shaheen owns one-third of the company, worth between $500,000 and $1 million, according to Jeanne Shaheen’s financial disclosure form. And William Shaheen is listed on the firm’s website as the chief executive, though Polcaro said Shaheen actually has “more of an advisory” role. The Shaheens reported six-figure losses in the investment on their tax returns.

The Shaheens faced embarrassing publicity last year after BuzzFeed reported that their daughter Molly used the family’s homestead in New Hampshire as the corporate address for her company, a lingerie maker named Naked Undies, even though Molly and the other founder are based in Los Angeles, according to the company’s website.

William Shaheen is listed as the company’s legal contact on corporate filings in New Hampshire and the company website mentions that Molly is the daughter of New Hampshire’s first female governor and senator.

Naked Undies was founded in 2011 and continued to use the New Hampshire address in its annual report filed in March. Molly Shaheen and the firm did not respond to interview requests.

Meanwhile, Jeanne Shaheen has been a vociferous opponent of federal efforts to force Internet retailers to collect sales tax from out-of-state customers. One such measure she opposed would have required companies with more than $1 million in online revenues to collect out-of-state sales taxes.

Shaheen’s office said the proposed legislation would not affect Molly Shaheen’s business because its revenues are well under $1 million.

The Shaheens also wouldn’t answer many of the Globe’s questions about their ties to Ultrawave, a small privately held Garden Grove, Calif., firm that says it is in the early stages of working on “breakthrough” imaging technology that could potentially help detect breast cancer.

William Shaheen, who originally met an Ultrawave cofounder through one of his other ventures in 2006, became an Ultrawave adviser in 2009, helping to introduce the company to potential investors and partners. He also acquired stock options in the company in November 2009 that the Shaheens estimated were worth between $1,000 and $15,000 at the time, shortly after the firm received stimulus funding. From 2010 to 2012, it paid a lobbyist to work with Congress and the federal government on additional breast cancer research programs.

Neither the company nor the Shaheens would say exactly when Shaheen began advising the company or when his stock options in the firm expired.

Jeanne Shaheen was in a position to be particularly influential over breast cancer research because she has roles on both the Armed Services Committee and an appropriations subcommittee overseeing health research.

One of the programs Shaheen has supported — funding breast cancer research through the military — has sparked debate.

Critics, including Republican Senator Tom Coburn of Oklahoma, complain the program is wasteful because it detracts from the Defense Department’s core mission and duplicates research done through other government programs. But advocates, such as the National Breast Cancer Coalition, argue the program’s unique structure allows it to support high-risk research that isn’t being funded elsewhere.

Ultrawave, however, insisted that government funding only accounted for a fraction of its funding and it never sought any earmarks — grants specifically set aside for the company.

And Kirstein, Shaheen’s campaign spokesman, argued the family’s investments and businesses are irrelevant because they are not in her name: “Senator Shaheen’s husband William and their daughter Molly are private citizens and they are not on the ballot this November.”

Globe correspondent Jeremy C. Fox contributed to this report. Todd Wallack can be reached at twallack@globe.com. Noah Bierman can be reached at nbierman@ globe.com.

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