Sen. Elizabeth Warren wants to ban members of Congress from ever trading individual stocks againMay 24, 2021
- Elizabeth Warren told Insider she’ll introduce a bill to ban lawmakers from individual stock trades.
- Sen. Richard Burr, once under a federal investigation, sold six figures’ worth of stock in April.
- Sen. Jim Inhofe just amended 20 years’ worth of financial disclosures. Airplanes are involved.
- See more stories on Insider’s business page.
Members of Congress routinely trade stocks, buying and selling the shares of companies that often have significant business before the federal government — and sometimes spend lots of money to lobby lawmakers.
Insider dug through congressional financial disclosure records federal lawmakers filed in recent days. Here are the latest highlights from what we’ve found.
Elizabeth Warren to target congressional stock trades
Sen. Elizabeth Warren, a Massachusetts Democrat, plans to introduce legislation during this congressional session that would ban members of Congress and other top government officials from buying and selling individual stocks, she told Insider.
“It is a no-brainer,” said Warren, a Massachusetts Democrat. “Every senator, member of Congress, president, Cabinet secretary, federal judge, and other senior officials in charge of writing the rules for our financial system should not be able to own or trade individual stocks.”
The legislation would be based on the “Anti-Corruption and Public Integrity Act” that Warren introduced in 2018 and re-introduced in 2020, both times without Senate co-sponsors. Rep. Pramila Jayapal, a Washington Democrat, sponsored companion legislation in the House during 2020.
Both Warren bills died in the then-Republican controlled Senate Finance Committee Republicans controlled the Senate.
What’s different now is that Democrats control the Senate, and Warren, who sits on the Finance Committee, has greater leverage to push the bill forward.
Numerous members of Congress have come under scrutiny for their stock trades in recent months. They include Sens. Richard Burr, a North Carolina Republican; Rep. Tom Malinowski, a New Jersey Democrat; and former Sens. David Perdue and Kelly Loeffler, both Republicans of Georgia.
Rep. Chris Collins, a New York Republican, went to federal prison last year after pleading guilty to insider trading charges. But Collins only served time for a few weeks because then-President Donald Trump pardoned him in December.
Top government officials, Warren said, “are there to serve the people, not their personal financial interests. Congress should pass anti-corruption legislation and restore American’s faith in government by making it work for everyone — not just the rich and powerful.”
Warren did not offer a specific timetable for when she plans to introduce her stock trading legislation this congressional session, which concludes in January 2023.
Burr goes bear
Burr, who endured a months-long federal investigation into his personal stock trades, last week reported making several recent stock sales along with his wife, Brooke Burr.
The Burrs sold up to $165,000 worth of stock in Enterprise Products Partners, a natural gas and crude oil pipeline company, between April 28 and April 30. The company’s stock price has remained effectively level since then.
Brooke Burr also reported selling up to $100,000 in MetLife Inc. floating rate non-cumulative preferred stock and up to $100,000 in US Bancorp depository preferred shares.
Burr, who wasn’t charged, made a flurry of stock sales on February 13, 2020, six days after co-writing an opinion article on FoxNews.com that sought to ease public concern over the threat COVID-19 posed to the United States.
“Thankfully, the United States today is better prepared than ever before to face emerging public health threats, like the coronavirus, in large part due to the work of the Senate Health Committee, Congress, and the Trump Administration,” Burr wrote along with then-Sen. Lamar Alexander, a Tennessee Republican.
But on February 27, Burr — then chairman of the Senate Intelligence Committee — told a more dire story to a small, private luncheon gathering at DC’s tony Capitol Hill Club.
“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,” Burr said, according to a secret recording obtained by NPR’s Tim Mak. “It is probably more akin to the 1918 pandemic.”
The Justice Department’s investigation of Burr’s February 2020 stock trades, together valued at more than $1.7 million, centered on whether the senator made his trades based on insider information obtained during senators-only briefings about the COVID-19 threat.
Burr said he is not planning to run for re-election in 2022.
Jim Inhofe moves to amend
An aviation junkie who announced his 2020 re-election bid by piloting an propeller plane upside down, Sen. Jim Inhofe, a Republican of Oklahoma, has regularly made news over the years for close-call incidents while flying.
More recently, Inhofe sought to remedy another aircraft situation — this time on paper.
In a May 17 letter to the US Senate Secretary Julie Adams, Inhofe acknowledged understating the value of the assets — most notably, airplanes — held by The Padre Company LLC, a limited liability company that the senator controls.
As of 2019, Inhofe’s LLC held three aircraft together valued at up to $1 million: a 1979 Grumman Tiger, a 1999 RV-8, and a 1979 Cessna 340. It also included real estate.
Inhofe wrote that his letter provides a “total reconciliation of the life of my assets” within The Padre Company LLC, which formed in 1999.
In short, Inhofe had not been previously factoring in the value of the real estate property as part of his public disclosure of the LLC. Now he is, which is why the reported value of the LLC has increased.
“Ahead of filing his annual disclosures each year, Senator Inhofe discusses it with the Ethics Committee to maximize transparency and ensure he is adhering to the spirit of the law, not just the letter of it,” spokesperson Leacy Burke told Insider. “Previously, it had been understood that these were considered personal properties and exempt, unreportable assets. This year, in the interest of greater transparency, he was encouraged to file the amendment and include them, as you can see he did.”
Sick of it all
House lawmakers representing opposite coasts — and different sides of the aisle — intersected financially in a weird way: wrestling with mortality.
The latest financial disclosures submitted by Rep. Mario Diaz-Balart, a Republican of Florida and the first congressperson to test positive for COVID-19, and Rep. Alan Lowenthal, a Democrat of California who happens to be married to a doctor, include stock trades dependent on the deterioration of the human condition.
Diaz-Balart’s wife apparently came to the conclusion that it was time to pull out of the telehealth business, prompting her to sell up to $100,000 worth of stock in virtual healthcare provider MDLIVE.
Lowenthal’s assessment was even grimmer. The five-term lawmaker bought up to $15,000 worth of stock in Service Corp. International — which specializes in funeral, burials, and cremations — via a jointly held trading account.
Malinowski’s trades again make waves
There’s renewed interest in Malinowski’s stock trades since Brian Slodysko of the Associated Press published an article last week that provided new details about how the congressman “sold as much as $1 million of stock in medical and tech companies that had a stake in the virus response.”
Politico, the Daily Beast, the New York Post, The Hill, and NJ.com were among the publications to pick up on the AP’s reporting, which built on Insider’s revelation in March that Malinowski had failed to disclose at least $671,000 — and as much as $2.76 million — worth of stock trades.
Following Insider’s exclusive, two nonprofit watchdog organizations — the Campaign Legal Center and the Foundation for Accountability and Civic Trust — filed separate congressional ethics complaints against Malinowski.
The congressman has continued to make stock trades this year. Insider recently reported that Malinowski on March 12 sold shares in Hologic Inc., a a medical diagnostic company. Hologic specializes in women’s health, but it also manufactures COVID-19 diagnostic equipment and last year signed a nine-figure contract with the federal government.
On Friday, Malinowski told NJ.com’s Jonathan Salant that the Office of Congressional Ethics has questioned him, effectively confirming that the independent body is proceeding with an investigation of Malinowski’s stock trades.
Malinowski maintains that he has no control over his day-to-day financial affairs, leaving stock trades and the like to a financial advisor.
“In practice, it was not something I was paying attention to,” Malinowski told Salant. “And of course it’s clear that any such arrangement carries with it these kinds of risks for a member of Congress. The conclusion I draw is we need much more strict rules governing the kinds of investments that elected officials can make.”
Source: Read Full Article