Newly released documents from an inquiry into Senator Richard Burr reveal that the North Carolina Republican had made huge profits from stock trades he made in February 2020, after receiving privileged information on the COVID-19 pandemic.
In 2020, the FBI launched an insider trading investigation into Burr for what the agency called “well-timed stock sales.” According to a search warrantThis week’s investigation was conducted by the Los Angeles Times in a Freedom of Information Act (FOIA) request, Burr had unloaded the vast majority of his and his wife’s holdings after the Senate Intelligence Committee, which he was a part of, was briefed about the pandemic and before the public was made aware of the pandemic’s coming effects.
According to an FBI affidavit obtained through the FOIA request, Burr made these transactions and profited more than $164,000 while avoiding $87,000 in losses.
“His portfolio went from approximately 83% in equities to approximately 3% in equities. Beginning on February 20, 2020 — six days after Senator Burr’s sale of the majority of his equity — the stock market endured a dramatic and substantial downturn,” the affidavit reads. The document was used to request a warrant to search Burr’s cell phone, which a court granted.
The senator had sold 95 percent of his holdings in his Individual Retirement Account (IRA) and 58 percent of holdings in his wife’s IRA. He also bought $1.2 million in Treasury securities using three-quarters his holdings in a joint account with his wife. on February 12. According to the FBI investigator, investors often buy Treasury funds in times of market downturns.
The affidavit also notes that Burr’s brother in law, Gerald Fauth, dumped roughly $160,000 in stocks after talking with Burr in texts and a call. Previous reporting had shown that Burr was a shrewd investor. had called Fauth a week before the market crashed due to the virus — and, a minute after hanging up, Fauth called his broker.
The document suggests thatThe Justice Department did have reasons to believe that Burr was involved insider trading or securities fraud, but the department eventually dropped its inquiry. Numerous other senatorsThey were also investigated for their trades at the same moment. were droppedSeparately from the inquiry about Burr.
According to a Securities and Exchange Commission (SEC), Burr and his brother were still being investigated by the SEC for insider trading as of October 2021. ProPublica. It’s unclear if that inquiry is still ongoing or what it has found.
Even if Burr is not charged in connection with his trades, the questionable timing of these trades and their expedient nature could support arguments for banning members Congress and other high-ranking government officials from trading individual stocks.
Lawmakers such as Sen. Elizabeth Warren (D.Massachusetts), are a part of the governing class. been advocating for a stock ban for More than a yearThe claim was made by the Congressional Black Caucus, which stated that allowing Congressmen to trade stocks is a conflict-of-interest and undermines public trust in the institution. Even though there are disclosure laws that require members to disclose their stock holdings to the public, Members of Congress and their staff regularly attendBreaking the law can result in little or no consequences
Congress supports bipartisan stock ban proposals. These are supported byA majority of the public agrees. However, none of the stock ban bills that have been introduced by lawmakers in the last year has been put to a vote.
Some Legislators suggested that the reason for the delay is House Speaker Nancy Pelosi (D-California), who has jurisdiction over which laws get a vote; Pelosi’s husband is a prolific stock trader who regularly trades hundreds of thousands or even millions of dollars’Stocks are worth their weight in companiesThese could be subject to oversight by Congress.
