Perdue’s portfolio under scrutiny

Questions arise over 2012 bill barring Congress from trading on nonpublic information.

As a member of the Senate’s cy ber security subcommittee, David Perdue has raised alarms that hackers from overseas pose a threat to U.S. computer networks. Citing a report by a California- based company called Fireeye, Perdue was among the senators who asked this spring that the National Guard pre - pare to protect against such data breaches.

Not only was this issue important to Perdue, but so was FireEye, a federal contractor that provides mal ware detection and threat intelligence services. Beginning in 2016, the senator bought and sold Fireeye stock 61 times, at one point owning as much as $ 250,000 worth of shares in the company.

Along with Sen. Kelly Loeffler, another Georgia Republic an, Perdue faces a runoff election in January. With control of the U.S. Senate at stake, and amid concern about the potential for conflicts of interest in stock trading by members of Congress, Perdue’s investment activity has come under the public glare.

Last week, The New York Times reported the Justice Department had investigated the senator for possible insider trading in his sale of more than $ 1 million worth of stock in a financial analysis firm, Cardlytics. Ultimately, prosecutors declined to bring charges.

Perdue disputes his investment activity posed a conflict, saying that his trades were handled by outside advisers without his input, although his instructions to Goldman Sachs to sell Cardly tics suggest that he directed at least some trades.

“Sen. Perdue doesn’t handle the day- to- day decisions of his portfolio; all of his holdings are managed by outside financial advisers who make recommendations, set strategy and manage trades and personal finances,” said John Burke, communications director for the senator’s reelection campaign.

Robert Hutchinson, Perdue’s weal t h manager a t Gol dman Sachs, declined to comment.

The Times analyzed data compiled by Senate Stock Watcher, a nonpartisan website that aggregates publicly available i nformation on lawmakers’ trading, and found that Perdue’s transactions accounted for nearly a third of all Senate trades reported in the past six years. His 2,596 trades, mostly in stocks but also i n bonds a nd f unds, roughly equal the combined trading volume of the next five most active traders in the Senate.

The data also shows the trades Perdue made in companies that stood to benefit from policy and spending matters that came not just before the Senate as a whole, but before the committees and subcommittee son which he served.

Nearly half of Perdue’s Fireeye trades, for example, occurred while he sat on the cybersecurity panel. During that period, Fireeye l anded a subcontract worth more t han $ 30 million with the Army Cyber Command, which had operations at Fort Gordon, in Perdue’s home state. In 2018, Perdue reported capital gains of up to $ 15,000 from Fireeye trades.

And as a member of the Senate banking, housing, and urban affairs committee since 2017, Perdue bought and sold shares of a number of financial companies his panel oversaw, including JP morgan Chase, Bank of America and Regions Financial.

In April, after questions were raised about stock trades that Perdue and other senators had made around the onset of the coronavirus pandemic, he sold virtually all of his stock holdings — between $ 3.2 million and $ 9.4 million worth. ( Members of Congress report their transactions in ranges, so it is impossible to pinpoint the exact dollar values.) In May, he announced that his advisers would no longer trade in individual stocks for his portfolio, with the exception of a few companies on whose boards he had previously served, including Cardlytics; the utility Alliant Energy; and Graphic Packaging, a paper-based packaging provider.

Al t hough Perdue has been active in stock trading, his investing highlights broader questions being debated more than eight years after the passage of the STOCK Act, a law meant to grapple with the ethical issues inherent in law makers’ buying and selling stocks.

The trend on Capitol Hill was already moving away from individual stock holding when Perdue was elected in 2014. Many senators had reduced their trading in individual stocks after the 2012 STOCK Act, which prohibited members of Congress from trading on nonpublic information acquired in the course of their duties. An analysis by Public Citizen published in 2017 credited the legislation with a 50% decline in stock trading by senators.

Perdue’s Democratic challenger, Jon Ossoff, has seized on the trading as a campaign issue. In a news conference Monday, he accused Perdue of “using his office to enrich himself ” through the stock trades. A spokesperson for Perdue called the critique a “discredited line of attack” that was “baseless,” and his campaign recently unveiled an ad arguing that he was “totally exonerated” by federal overseers who had studied his trades.

‘ Sen. Perdue doesn’t handle the dayto- day decisions of his portfolio; all of his holdings are managed by outside financial advisers who make recommendations, set strategy and manage trades and personal finances.’ John Burke

Communications director for the senator’s reelection campaign

ASSOCIATED PRESS A spokesperson for Sen. David Perdue, R- Ga., ( above) has said the claims by opponent John Ossoff of the senator enriching himself through stock trades are “baseless.”