‘Is it worth it to have the American people distrust you so you can make some extra side money by insider trading on the market?’
(Ben Sellers, Liberty Headlines) The Senate’s newest member, Sen. Kelly Loeffler, R-Ga., sought to defend herself amid recent allegations of insider trading prior to the economic collapse due to the Wuhan virus pandemic.
Loeffler was one of four senators discovered to have sold off stock in January and early February—after several Senate committees had been briefed on the Centers for Disease Control and Prevention‘s fears of an outbreak but about a month before the World Health Organization designated it a pandemic.
Due to their November re-election campaigns, Loeffler and Sen. Richard Burr, R-NC, have faced the lion’s share of criticism in the scandal, much of it coming from their own conservative base.
Loeffler said her stock portfolio was managed by a third-party broker without her direct knowledge or input.
“The actions are blind to me until they put it in front of me at the end of the reporting period,” she told Fox Business host Neil Cavuto.
However, Loeffler did not specifically say that her investments were placed in a blind trust, as anti-corruption watchdogs including conservative investigative journalist Peter Schweizer have proposed in the wake of the scandal.
“Members of Congress, is it worth it to have the American people distrust you so you can make some extra side money by insider trading on the market?” Schweizer asked during a podcast Monday of SiriusXM’s Breitbart News Daily.
“Because that’s really ultimately what this is about,” Schweizer continued. “There’s no legitimate explanation or reason that they can give for them not to be required to put their assets in a blind trust.”
Initial reporting based on financial disclosures, from left-wing media outlets including ProPublica and NPR, indicated Loeffler had unloaded more than $3 million on the same day as the Senate Health Committee’s CDC briefing.
She disputed the accusations, saying that the moves were not even sell offs so much as an effort to tap into the then-booming economy with more high-yield investments.
“I will just tell you, in that portfolio, it’s absolutely false that we sold millions,” Loeffler said. “Actually, it was a more bullish bet. We ended up owning companies like Delta, like Goldman Sachs, like Prudential, companies that have been hard-hit and ended up losing money.”
But Schweizer noted that Loeffler’s claims to have invested in those companies was far from reassuring, particularly in light of the current economic crisis, since those major companies would be beholden to Congress for possible stimulus funding.
“Here’s the problem,” he said. “Members of Congress can trade stock in Delta Airlines or Boeing while they’re working on this bailout—while they’re voting on it—and it just throws the integrity of the whole process into question.”
Loeffler is facing a challenge on the right from Rep. Doug Collins, R-Ga., who criticized Loeffler in several cable appearances and tweets.
On Monday, his campaign Twitter said that the Securities and Exchange commission had rebuked the senator and her husband, New York Stock Exchange Chairman Jeff Sprecher.
— Doug Collins (@CollinsforGA) March 23, 2020
“We wish to emphasize the importance of maintaining market integrity and following corporate controls and procedures,” said the SEC statement.
“For example, in these dynamic circumstances, corporate insiders are regularly learning new material nonpublic information that may hold an even greater value than under normal circumstances,” it continued. “… Those with such access … should be mindful of their obligations to keep this information confidential and to comply with the prohibitions on illegal securities trading.”
Although a political newcomer, Loeffler said her years of field experience as a financial analyst had made her well-versed in the need to meet ethics requirements and other SEC regulations.
“I have been around much more substantial material, non-public information than probably any of my peers in the Senate,” she said. “I know exactly how to manage through this.”
She denounced what she saw as unfair and imbalanced reporting after the story broke, the timing of which seemed designed to channel the frustration and outrage that many were feeling over the drastic reversal of fortune wrought by the health crisis.
Loeffler said the scapegoating of her stock trades was misdirected.
“This is fake news,” she said. “It’s preying on the emotions of the American people and trying to create a narrative that’s absolutely false, and no one’s bothered to fact-check it.”