Senators Under Fire for Dumping Stocks Ahead of Coronavirus Pandemic
The senators have defended their selling of the stocks.
Bombshell reports have emerged that multiple United States senators sold off stocks in the early stages of the coronavirus pandemic.
Some of the senators, including South Carolina Republican Richard Burr, are facing calls to resign amid the controversy.
Burr, the Intelligence Committee chairman, had warned some well-connected donors of the dire financial impacts of coronavirus amist selling off $1.6 million of his own stocks last month, according to reports.
But in February, Burr wrote in a Fox News op-ed that “the United States today is better prepared than ever before to face emerging public health threats, like the coronavirus.” Later that month, he sold off his stocks just as patients were testing positive for COVID-19 in America.
Burr’s trades were made known to the public in his financial disclosure reports. Since Burr's sales, the stock market has declined 30 percent.
As spokesperson for Burr told NBC News that what he did was “personal transactions made several weeks before the U.S. and financial markets showed signs of volatility due to the growing coronavirus outbreak."
Burr also tweeted his defense and denial early on March 20, and said he “relied solely on news reports” in selling his stocks, not inside information.
Conservative Fox News pundit Tucker Carlson slammed Burr on his show Thursday night and called for his resignation.
“Maybe there’s an honest explanation for what he did; if there is, he should share it with the rest of us immediately,” Carlson said. “Otherwise, he must resign from the Senate and face prosecution for insider trading.”
Congresswoman Alexandria Ocasio-Cortez of New York also called for Burr to resign saying on Twitter “got private briefings about Coronavirus weeks ago. Burr knew how bad it would be. He told the truth to his wealthy donors, while assuring the public that we were fine. THEN he sold off $1.6 million in stock before the fall. He needs to resign."
Burr has asked the Senate Ethics Committee to review the matter.
Burr isn’t the only senator who was found to have sold stocks amid the pandemic.
Freshman Republican Senator Kelly Loeffler of Georgia, who also happens to be married to the chairman and CEO of the New York Stock Exchange, sold off seven figures worth of stocks.
She and her husband reported the sale of their stocks on January 24, which also happened to be the first day of her committee, Senate Health Committee, hosted a private meeting with CDC head and Dr. Anthony Fauci, the head of the National Institute of Allergy and Infectious Diseases, on the coronavirus, as well as administration officials.
Between January 24 and mid-February, she and her husband made 29 stock transactions.
Following reports of her sales, she took to Twitter on March 20 to defend herself saying, “This is a ridiculous and baseless attack. I do not make investment decisions for my portfolio. Investment decisions are made by multiple third-party advisors without my or my husband's knowledge or involvement.”
She also tweeted a chart showing that “As confirmed in the periodic transaction report to Senate Ethics, I was informed of these purchases and sales on February 16, 2020 — three weeks after they were made.”
Democratic Senator Dianne Fienstein was also noted to have sold stocks.
“Senator Feinstein did not sell any stock,” a spokesperson for her office told NBC News. “The transactions you're referencing were made by her spouse. All of Senator Feinstein's assets are in a blind trust, as they have been since she came to the Senate. She has no involvement in any of her husband's financial decisions."
On March 1 Barrons noted that the stock sale happened near the stock's 2020 low.
Oklahoma Senator James Inhofe, who this week voted no on the senate’s coronavirus bill, was also named. He called his selling of stocks based on the January 24 meeting “completely baseless and 100 percent false” according to CBS News.
“I do not have any involvement in my investment decisions. In December 2018, shortly after becoming chairman of the Senate Armed Services Committee, I instructed my financial advisor to move me out of all stocks and into mutual funds to avoid any appearance of controversy. My advisor has been doing so faithfully since that time and I am not aware of or consulted about any transactions," Inhofe said in a statement obtained by CBS News.
Eight years ago, CBS News’ “60 Minutes” reported that members of Congress could legally trade stocks based on non-public information and explained the strange loophole-like process.
“They do [get a pass on insider trading],” author and fellow at the Hoover Institution, Peter Schweizer told “60 Minutes” in 2012. “The fact is, if you sit on a healthcare committee and you know that Medicare, for example, is — is considering not reimbursing for a certain drug that's market moving information. And if you can trade stock on — off of that information and do so legally, that's a great profit making opportunity. And that sort of behavior goes on.”
Following that report, the STOCK Act was passed and signed into law in an attempt to cut down on insider trading from members of Congress. Parts of the law were quietly reversed in 2013.
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