U.S. Commerce Secretary Wilbur Ross said there was nothing improper about his investments in a shipping firm with significant ties to Russian President Vladimir Putin's inner circle, a day after the Paradise Papers shone light on his investments.

Ross, a billionaire private equity investor, divested most of his business assets before joining President Donald Trump's cabinet in February, but kept a stake in the shipping firm, Navigator Holdings Ltd., which is incorporated in the Marshall Islands in the South Pacific. He is a former chairman of Navigator.

Offshore entities in which Ross and other investors hold a financial stake controlled 31.5 per cent of the company in 2016, according to Navigator's latest annual report. Among Navigator's largest customers, contributing over $68 million US ($87.3 million Cdn) in revenue since 2014, is the Moscow-based gas and petrochemicals company Sibur.

"The fact that [Sibur] happens to be called a Russian company does not mean there's any evil in it," Ross said in an interview with BBC, adding that Sibur is not under any U.S. sanctions.

What the Paradise Papers reveal about Trump’s inner circle, Russia connections2:25

Ross said the Navigator-Sibur business relationship predated when he joined Navigator's board and that there is no interlocking of board membership between the two companies.

Ross told Bloomberg TV in a separate interview that he has been thinking of selling his stake, "but that isn't because of this [report]."

Ross's connections emerge from an examination of public records and a leak of millions of offshore financial documents from the Bermuda law firm Appleby obtained by German newspaper Sueddeutsche Zeitung. The so-called Paradise Papers were shared with the International Consortium of Investigative Journalists and its global network of media partners, including CBC/Radio-Canada and the Toronto Star in Canada.

'Politically charged interpretation'

Ross is not accused of any illegality, but Democratic Senator Richard Blumenthal of Connecticut urged the Commerce Secretary's inspector general to open an investigation to ensure there were no improprieties.

"Secretary Ross's financial disclosures are like a Russian nesting doll, with blatant conflicts of interest carefully hidden within seemingly innocuous holding companies," Blumenthal said in a statement.

Separately, Sibur said on Monday it had no direct dealings with Ross and that its ties to its partners were not in breach of sanctions imposed on Russia over the Ukraine crisis.

Stakeholders in Sibur include Gennady Timchenko, an associate of Russian Vladimir Putin who is subject to U.S. and Canada sanctions enacted after Russia's 2014 invasion of Crimea. Another Sibur shareholder is Putin's son-in-law, Kirill Shamalov, who is married to the president's youngest daughter.

Ross told Bloomberg that Navigator had "no business ties to those Russian individuals who are under sanction."

Sibur said that in the first half of this year, Sibur spent $15.9 million on services provided by Navigator, or 2.8 per cent of its overall expenditure on logistics. It said Navigator was never a sole contractor for shipping Sibur's petrochemical products.

Timchenko-Shamalov

Russian tycoon Gennady Timchenko, left, seen in Krasnodar, Russia on May 23, has been sanctioned by Canada and the U.S. Kirill Shamalov, right, has a stake in Sibur and is married to Russian President Vladimir Putin's daughter. (Sergei Karpukhin/Reuters)

"All negotiations and meetings were held solely by Sibur management and solely with management of those companies [which were shipping Sibur's liquefied petroleum gas] and without shareholders' involvement," Sibur said in an emailed statement.

"In connection with the introduction in 2014 of sanctions with regard to one of the company's shareholders, our counter-parties conducted all necessary checks into whether there were any restrictions on working with Sibur. No such restrictions were found," the statement said.

"Sibur expresses its surprise at the politically charged interpretation in certain media publications of regular commercial activities, over many years, which from the outset were reflected in the company's published accounts."

Shamalov did not reply to an email from Reuters seeking comment. Spokesman for Volga Group, an investment vehicle for Timchenko's assets, declined to comment.

While Ross downplayed the link on Monday, the details came to light as a shadow has emerged over Donald Trump's presidency due to allegations of untruthfulness, at minimum, among members of his campaign team and some administration members regarding their contacts with foreign governments, especially Russia.

Democrats raised Ross concerns

Former Trump election campaign chairman Paul Manafort has been indicted on charges that include violations under the little-enforced Foreign Agents Registration Act, while attorney-general Jeff Sessions was accused of evasiveness during his confirmation hearings regarding his contacts with the Russian ambassador to the U.S.

Sessions subsequently recused himself from any investigations concerning possible Russian meddling in the 2016 U.S. election and any collusion between Trump officials and foreign entities. That recusal helped pave the way for the appointment of former FBI Director Robert Mueller as special counsel, who can recommend charges for any criminal wrongdoing he uncovers.

The Paradise Papers release also raise questions related to Ross's confirmation process. As commerce secretary, he has a direct authority over trade and manufacturing policy and is an influential voice in the government on virtually any aspect of the U.S. economic relationship with other countries, including Russia.

Ross was asked repeatedly at the time about his business ties to Russia, mostly related to his former role as vice-chairman of the Bank of Cyprus, which has a long history of financing Russian oligarchs.

He was also asked about his shipping holdings and whether they could pose a conflict of interest with his duties at Commerce. But he faced no questions about Navigator and its relationship with Sibur.

Ross did not respond directly to a letter signed by five Democratic senators prior to the hearings inquiring into "the full extent of your connections with Russia."

But he told BBC there is "no basis in fact" to the suggestion he didn't disclose the holdings, claiming they were part of three different written submissions during the confirmation process.

With files from ICIJ & Reuters