TITLE: GOP Rep. Mike Garcia Secretly Sold Boeing Stock Ahead of Damning Report
https://www.thedailybeast.com/gop-rep-mike-garcia-secretly-sold-boeing-stock-ahead-of-damning-report
EXCERPT: As a member of the House Committee on Transportation and Infrastructure, Garcia was privy to a long-running congressional investigation into Boeing’s role in the 737 Max crashes. In September 2020, one month after Garcia’s trade, the committee produced its findings—an unsparing critique of the company, just ahead of regulatory recertification.
But experts said that it’s difficult to know whether Garcia was actually engaging in insider trading. That criminal allegation hangs on a precise technical definition—access to “material non-public information”—which can be notoriously difficult to prove. And Garcia, like many Americans at the time, was aware of just how difficult that could be.
In the months before the Boeing sale, Congress had been rocked by a trading scandal after a number of lawmakers engaged in well-timed transactions just ahead of the COVID pandemic. The audacity of those trades generated national outrage, prompting warnings from federal regulators and sparking widespread calls for a congressional trading ban and criminal investigations.
The Justice Department opened probes into several senators, including Richard Burr (R-NC), Kelly Loeffler (R-GA), David Perdue (R-GA), Jim Inhofe (R-OK), and Dianne Feinstein (D-CA), who had all carried out trades in proximity to private COVID briefings.
But the DOJ had shuttered most of those probes by the summer, and none of the senators ever faced charges. The Securities and Exchange Commission also closed its parallel investigations without publicized action. (It’s still unclear what became of the SEC’s inquiry into Loeffler; neither she nor her husband, the chair of the New York Stock Exchange, have commented publicly.)
Even against that backdrop, the legal experts agreed that Garcia’s trade merits further investigation.
“This situation appears to be the exact kind of fear that people talk about where members of Congress are benefiting from their position,” Libowitz speculated. “He knew bad news was coming for Boeing and was in a particular place to know and he made a move on that.”
Ben Edwards, a securities expert at the University of Las Vegas Boyd School of Law, said the fact-pattern suggests that Garcia’s decision to sell his Boeing stock “might have been triggered by knowledge that the committee report was about to come out.”
Edwards floated a few possible explanations for Garcia’s delay. It could be evidence of “consciousness of guilt” about potential insider trading, he said, or perhaps a political calculation—appreciating that “this is information that might negatively impact him in a close race, so he decided to withhold it.”
A third option, he said, is that Garcia “had a lot of distractions and didn’t make this a priority,” though Edwards noted that Garcia wasn’t too busy to plan the trade in the first place.
The Boeing trade disclosure was also not Garcia’s only ethics violation. In the same report, Garcia was late to disclose two other transactions—a Sept. 4 purchase of Tesla shares valued between $15,000-$50,000, and an American Airlines buy in the same price range on July 9, disclosed more than three months past the deadline. (The next day, American Airlines pushed back against Boeing, threatening to cancel orders for the 737 Max.)
But the Boeing sale stands apart from Garcia’s trading history. His transaction reports reveal a cluster pattern, trading multiple stocks either on the same day or within a few days of each other. The August Boeing sale, however, was isolated, with no other transactions for a month on either side.
“That eliminates a portfolio-wide sale as an excuse,” Edwards said. “He picked that stock. Why?”
TITLE: Congressman Buys, Sells Penny Stock For Profit: Here's The Trade And For How Much
https://www.nasdaq.com/articles/congressman-buys-sells-penny-stock-for-profit:-heres-the-trade-and-for-how-much
EXCERPT: Rep. Kevin Hern (R-OK) was one of several members of the U.S. House of Representatives who were nominated or interested in the Speaker of the House position after Kevin McCarthy was voted out of the role.
Hern was elected to the House in 2018 and served since then. The congressman has been a vocal supporter of former President Donald Trump and was one of the Republicans who attempted to overthrow the 2020 presidential election results.
The Oklahoma Republican representative is also an active stock trader, which may come from his business background. Hern has been the owner of several businesses and is a former franchisee of McDonald's restaurants. A local paper once called Hern the McCongressman before he sold all of the McDonald's franchised restaurants he owned.
A recent stock transaction by Hern could draw attention — and it wasn't of McDonald's.
Data from Quiver Quant shows that Hern recently sold shares of mortgage company Freddie Mac (OTC:FMCC).
The disclosure shows Hern sold $100,000 to $250,000 worth of Freddie Mac shares on Nov. 6. Data showed Freddie Mac shares trading between 64 cents and 67 cents on the day of the sale.
Data from Quiver Quant showed Hern bought $100,000 to $250,000 worth of Freddie Mac shares earlier this year on Jan. 30, in a trade that was disclosed publicly on Feb. 14. Shares of Freddie Mac traded between 45 cents and 47 cents on the day of the purchase.
Based on the prices at the time of the two transactions, Hern profited 42.2% to 48.9% on the trade.
Why It's Important: Hern is allowed to buy and sell stocks and options as a member of Congress as long as he publicly discloses the transactions in a timely fashion.
Hern previously violated the STOCK Act failing to disclose transactions he made in 2021.
While most members of Congress buy and sell stocks and options of large companies, Hern's latest transaction involves a well-known company, but one that trades off of the major exchanges and trades for less than $1.
Freddie Mac, also known as Federal Home Loan Mortgage Company, along with Fannie Mae was put under the conservatorship of the Federal Housing Finance Agency in 2008 as part of a rescue plan from the 2008 financial crisis.
Hern is a member of the House Committee on Ways and Means, which is the chief tax-writing committee of the House of Representatives.
TITLE: Democrats' choice to replace George Santos is lukewarm on abortion, violated federal law over 300 times with his stock trades, and once said Florida's 'Don't Say Gay' bill is 'common sense'
https://www.businessinsider.com/who-is-tom-suozzi-george-santos-democrats-special-election-2023-12
EXCERPT: When Business Insider published its "Conflicted Congress" investigation of lawmakers' stock trades and financial holdings in 2021, Suozzi was one of just 13 lawmakers who earned a "Danger" rating.
That's because he violated the Stop Trading on Congressional Knowledge (STOCK) Act, a federal law designed to prevent insider trading, more than 300 times.
That doesn't mean Suozzi was actually doing insider trading.
He simply didn't file any periodic transaction reports — which he was required to do any time he made a significant trade — for three years. And it landed him a formal ethics complaint from the Campaign Legal Center, an ethics watchdog.
The House Ethics Committee ultimately declined to fine Suozzi for those violations, determining that he and other lawmakers who violated the STOCK Act "were generally unclear on the requirements" of the law.
Suozzi cashed in when his term ended, becoming the co-chair of the lobbying and consulting firm Actum.