PHOENIX — Arizona U.S. Senate candidate Blake Masters will leave his job with billionaire Peter Thiel's investment firm before the Republican primary in August 2022, his campaign manager said in an email Monday to 12 News.
The announcement comes just four days after Masters reported more than $1.1 million in income from California-based Thiel Capital on his first Senate financial disclosure form.
Thiel has been a mentor, boss and now political patron of Masters, as the 35-year-old Tucson native makes his first run for office.
Thiel put up $10 million to create the Saving Arizona PAC, an independent expenditure committee that is already up with TV ads attacking another GOP Senate candidate, Arizona Attorney General Mark Brnovich.
Thiel also hosted a Los Angeles fund-raiser last month for Masters.
"Blake plans to fully transition away and resign from Thiel Capital before the primary election," Masters' campaign manager, Amelia Halikias, said via email.
She did not respond to a request for an interview with Masters.
Report Raises Conflict Questions
A government ethics expert said Masters' financial disclosure raised questions about potential conflicts of interest.
"Is this member of Congress here to serve the voters or do the bidding of a wealthy donor?" said Delaney Marsco, senior legal counsel for ethics at the Campaign Legal Center.
"His way of telling voters I'm going to step away from the company, we don't really know what that means until it comes to pass."
Cryptocurrencies and 'Gun Trust'
Masters' financial disclosure revealed his lucrative ties to Thiel, along with a large investment in cryptocurrencies and a "firearms trust":
-A salary of $774,427 at Thiel Capital.
-Book royalties of $340,376, paid through Thiel Capital.
-An executive bonus plan, based on Thiel Capital investments, that vests over five years, ending on Jan. 1, 2023. Under the plan's terms, payments are made when the plan vests. It's not clear whether Masters would give that up.
-Masters' largest investment is in several cryptocurrencies, with a reported value of $1.5 million to $6.2 million. Cryptocurrencies rarely turn up on congressional financial disclosures.
-An "NFA Trust," for weapons regulated by the National Firearms Act. Masters lists those weapons as "guns and silencers."
The reported value of the trust is between $15,000 and $50,000.
"Owners of NFA items often find it legally desirable to own those items through a trust," Halikias said via email. "It can make it easier to navigate the heavy regulations and stay compliant."
You can read more about an NFA Trust here.
Based on Masters' financial disclosure, his reported net worth is in a range as high as $9.3 million.
Thiel's Stake in Senate Race
Thiel himself has a significant financial stake in what happens in the Senate.
The PayPal founder is also a board member and the first outside investor in Facebook, the subject of intense scrutiny on Capitol Hill. Thiel is also a co-founder of Palantir, a data-mining company with more than a billion dollars in federal contracts.
How Masters, Thiel Met
Masters and Thiel met when Masters was a student at Stanford University.
They co-wrote the 2014 best-seller "Zero to One," based on notes that Masters took during a Thiel class at Stanford University.
Masters went to work for Thiel in 2015 as president of the non-profit Thiel Foundation. In 2018 he joined Thiel Capital as chief operating officer and special counsel.
Thiel Backed Candidate Trump
Thiel was the rare Silicon Valley luminary who endorsed candidate Donald Trump in 2016.
Masters is one of two U.S. Senate candidates who've benefited from a $10 million Thiel check.
The field for Arizona's Republican Senate primary comprises Masters; Brnovich; businessman Jim Lamon; and retired Air Force Maj. Gen. Michael “Mick” McGuire, former commander of the Arizona National Guard.
Arizona Corporation Commissioner Justin Olson, a former state lawmaker, is also expected to enter the race.
The winner will face Democratic Sen. Mark Kelly in the November 2022 election.
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