Friday, March 20, 2020

Four U.S. senators dumped stocks before coronavirus-induced market crash, apparently putting their private financial interests over concerns about public health

U.S. Sen. Kelly Loeffler (R-GA)

 What kind of leadership is the U.S. Senate providing in a time of crisis? With coronavirus deaths mounting from coast to coast, four senators -- three of them Republicans -- reportedly unloaded stocks ahead of a pandemic-induced market crash.

One of the senators, Richard Burr (R-NC), was caught on audio telling constituents the outbreak was going to reach crisis proportions in the U.S. -- all while party leaders, including so-called president Donald Trump, were downplaying it as a "hoax."

Were these senators putting profit over public health? Did they commit insider-trading crimes? Could they wind up with significant prison sentences? This story is evolving, and more high-level officials almost certainly will be unmasked. But for now, the answer to all three questions above appears to be yes. From a Bloomberg Business report titled "U.S. Senators Sold Stock After Coronavirus Briefings in January":

Four U.S. senators sold stock after receiving sensitive briefings in late January about the emerging threat of the coronavirus, sparking concerns that they put safeguarding their private finances before their duty to protect public health.

Senator Richard Burr, a Republican from North Carolina, and Kelly Loeffler, a Republican from Georgia, both completed their sales at a time when the Trump administration and GOP leaders were downplaying the potential damage the virus might cause in the U.S. and before drastic stock-market plunges set off by the pandemic.

Burr is chairman of the Senate Intelligence Committee, which receives frequent briefings about threats facing the country, and has experience responding to public-health crises. Loeffler – who was appointed to her seat in December after Senator Johnny Isakson announced that he was resigning because of health problems – is married to the chairman of the New York Stock Exchange, Jeffrey Sprecher.

Two other members of the Intelligence Committee, Senator Dianne Feinstein, a Democrat from California, and Senator James Inhofe, an Oklahoma Republican, also sold stock after the briefings, according to financial records.

Bloomberg provides details about transaction for all four senators:

Loeffler did not make any sales from Jan. 6 until Jan. 24 -- the day the health committee she sits on held a briefing that included presentations from top level U.S. public-health officials, including Dr. Anthony Fauci. Senate Impeachment Trial Of President Trump.

She and her husband began selling 27 stocks on Jan. 24, according to her financial disclosure form, including investments in Auto Zone and Ross Stores, worth millions of dollars. Loeffler’s stock sales were first reported by the Daily Beast.

Loeffler responded on Twitter by calling criticism of her stock sales “a ridiculous and baseless attack.” The tweet said “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.”

Burr sold 33 stocks on Feb. 13, according to his financial disclosure form, with a total value between $628,000 and $1.7 million. His stock sales were first reported by ProPublica. Three of the assets he sold were in hotel companies, which have seen their value plummet as the coronavirus threat has drastically curtailed travel.

His office said that his sales were unrelated to any information he received by virtue of his position as intelligence committee chairman. . . .

Feinstein made transactions on Jan. 31 and Feb. 18, selling between $1.5 million and $6 million worth of shares in Allogene Therapeutics, a biotech company. Inhofe sold $400,000 worth of stock on Jan. 27, including PayPal and the real estate company Brookfield Asset Management.

From USA Today, regarding Feinstein:

Feinstein spokesman Tom Mentzer told Fox News Feinstein's assets are in a blind trust and, "She has no involvement in her husband’s financial decisions.”

All four senators appear to be acting with greed and self interest. But the biggest scoundrel, so far, might be Burr. A number of public figures, including U.S. Rep. Alexandria Ocasio Cortez (D-NY) have called for his resignation. From a report at NPR:

The chairman of the Senate Intelligence Committee warned a small group of well-connected constituents three weeks ago to prepare for dire economic and societal effects of the coronavirus, according to a secret recording obtained by NPR.

The remarks from U.S. Sen. Richard Burr were more stark than any he had delivered in more public forums.

On Feb. 27, when the United States had 15 confirmed cases of COVID-19, President Trump was tamping down fears and suggesting that the virus could be seasonal.

"It's going to disappear. One day, it's like a miracle. It will disappear," the president said then, before adding, "it could get worse before it gets better. It could maybe go away. We'll see what happens."

On that same day, Burr attended a luncheon held at a social club called the Capitol Hill Club. And he delivered a much more alarming message.

"There's one thing that I can tell you about this: It is much more aggressive in its transmission than anything that we have seen in recent history," he said, according to a secret recording of the remarks obtained by NPR. "It is probably more akin to the 1918 pandemic."

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