Senators’ pre-crash sales under scrutiny United States
Facing public outrage, senators from both the Republican and Democratic parties have denied that they exploited advance knowledge when they dumped stocks and other financial holdings before the coronavirus wreaked havoc on the economy.
North Carolina Republican and Senate Intelligence Committee chairman Richard Burr, whose sales of as much as US$1.7 million (NZ$2.97m) worth of stock have come under the most scrutiny, yesterday requested an ethics review of his actions in the days before markets dropped in February.
Burr and the other senators have pushed back strongly against suggestions that they used sensitive government information to protect their financial wellbeing, at a time when political leaders are urging Americans to make shared sacrifices to stop the virus.
Senate records show that Burr and his wife sold between US$600,000 (NZ$1m) and US$1.7m worth of shares in more than 30 transactions in late January and mid-February, just before markets began to plummet and government health officials began to sound alarms about the virus. Several of the stocks were in companies that own hotels.
Burr yesterday acknowledged selling the stocks because of the virus, but said he relied ‘‘solely on public news reports’’ to make the decisions.
Most of the sales happened on February 13, just before Burr made a speech in Washington, DC in which he predicted severe consequences from the virus.
Georgia Republican Kelly Loeffler, a new senator up for reelection this year, sold hundreds of thousands of dollars worth of stock in late January and February, as senators began to get briefings on the virus, according to records.
So did fellow Georgia Senator David Perdue, another Republican running for reelection, as well as Republican Senator James Inhofe of Oklahoma and Democratic Senator Dianne Feinstein of California.
Loeffler and her husband sold between US$1.1m (NZ$1.92m) and US$2.8m (NZ$4.9m) worth of stock. But they plunged hundreds of thousands of dollars into real estate investment firm Blackstone, tech company Oracle, and Citrix Systems – a company that develops workplace and telecommuting software.
Perdue sold off as much as US$770,000 (NZ$1.35m) worth of stock in February in more than 40 transactions, including stock in the Nevada-based casino company that owns Caesars Palace in Las Vegas. The industry has been battered by the virus, which has led casinos to shut down.
Perdue attended a February 25 Senate Armed Services Committee meeting where the spread of the coronavirus was discussed. In the days after, he invested as much as US$260,000 (NZ$455,000) in pharmaceutical company Pfizer, according to a disclosure.