'Conflicted Congress': Key findings from Insider's five-month investigation into federal lawmakers' personal finances (AND SEARCHABLE DATABASE)

Dozens of federal lawmakers and at least 182 top staffers have violated a conflict-of-interest law. Numerous members of Congress personally invest in industries they oversee. Few face serious consequences, legally or otherwise. The nation is unabashedly polarized. Republicans and Democrats enjoy little goodwill and less commonality.

But in Washington, DC, a bipartisan phenomenon is thriving. Numerous members of Congress, both liberal and conservative, are united in their demonstrated indifference toward a law designed to quash corruption and curb conflicts-of-interest.

Insider's new investigative reporting project, "Conflicted Congress," chronicles the myriad ways members of the US House and Senate have eviscerated their own ethical standards, avoided consequences, and blinded Americans to the many moments when lawmakers' personal finances clash with their public duties.

In all, Insider spent hundreds of hours over five months reviewing nearly 9,000 financial-disclosure reports for every sitting lawmaker and their top-ranking staffers. Reporters conducted hundreds of interviews, including those with some of the nation's most powerful leaders.

Cbsnews.com
circa 2011

pelosi and visa

As Steve Kroft reported on “60 Minutes,” Pelosi is one of many lawmakers whose stock market trades could have been seen as a conflict of interest. The former speaker and her husband have participated in at least eight IPOs, one of which was from Visa in 2008 - just as a troublesome piece of legislation that would have hurt credit card companies began making its way through the House. The Pelosis purchased 5,000 shares of Visa at the initial price of $44 dollars. Two days later it was trading at $64.

Now Newsweek and The Daily Beast report that this stock purchase was made as Visa was engaged in a full-court press to lobby Pelosi to stop legislation to curb credit-card swipe fees to vendors.

In 2007, Visa used an army of lobbyists to try to influence Pelosi, including one of her former advisers, Dean Aguillen, Newsweek reports. Aguillen left Pelosi’s office to work for the lobbying firm Ogilvy. By law, he could not lobby Pelosi’s office directly, but he did lobby Congress on the credit card issue and offered advice to other lobbyists on that particular mission.

In addition to exploiting the revolving door between Congress and lobbying firms, Visa’s political action committee made a $1,000 donation to Pelosi’s re-election campaign, Newsweek reports (Visa headquarters is in Pelosi’s home district). Two days after that donation was made, Pelosi met with Visa executives in her office. Aguillen also contributed $1,000 to Pelosi and another $1,000 to the campaign arm of the House Democratic caucusin the first half of 2008.

The former speaker maintains she wasn’t influenced by Visa’s lobbying efforts or her husband’s stock purchases. “I will hold my record in terms of fighting the credit card companies as speaker of the House or as a member of Congress up against anyone,” she told “60 Minutes.”

Indeed, the swipe fee legislation opposed by credit card companies eventually passed. Additionally, in 2008 — before the Pelosis’ stock transaction — the House passed the Credit Cardholders’ Bill of Rights over the objections of the industry.

Drew Hammill, a spokesman for Pelosi, said her husband Paul Pelosi’s finances are kept distinctly separate from the congresswoman’s legislative work, Newsweek reports.

Pelosi is far from the only example of a legislator about whom questions have been raised.

“We know that during the health care debate people were trading health care stocks,” Peter Schweizer, a fellow at the conservative Stanford think tank the Hoover Institution, told “60 Minutes.” “We know that during the financial crisis of 2008 they were getting out of the market before the rest of America really knew what was going on.”

With the new focus on congressional “insider trading,” legislation to stop it is gaining momentum. Democratic Reps. Louise Slaughter of New York and Tim Walz of Minnesota have introduced legislation to stop insider trading in Congress. But the bill, which has been introduced before, has never had more than 14 congressional sponsors.

Today, however, Sens. Scott Brown, R-Mass., and Kirsten Gillibrand, D-N.Y., and said they will introduce the legislation in the Senate. Several other lawmakers are now saying they could support the measure, Roll Call reports, including Pelosi.

Watch the “60 Minutes” report at web site:

It is illegal for Congress members to trade based on non-public information gathered during their official duties.

Pelosi Defends Stock Investment by Members of Congress:
‘We’re a Free Market Economy’

House Speaker Nancy Pelosi’s husband cashed in on Big Tech just as Congress was set to pounce

BY SOPHIE MELLOR, Fortune, July 8, 2021 8:26 AM EDT

The week before the House Judiciary Committee voted on reigning in big tech, Speaker Nancy Pelosi’s husband exercised a bullish bet on Google-parent Alphabet, in a timely transaction that netted him $5.3 million.

The antitrust bill was advanced as a push by the government to curb the “unregulated power” of big tech firms Google, Amazon, Apple and Facebook. It was the final part of a six-part package called “Ending Platform Monopolies Act” aimed at restricting how big tech companies offer their products to ensure they don’t use their size to dominate the market.

However, despite its good intentions, the market reaction to the judiciary panel approving the legislation was muted—shares in big tech companies in fact rose after investors found the House proposal to be no real threat.

Paul Pelosi, who bought 4,000 shares of Alphabet on June 18 (as revealed in a financial disclosure signed by Nancy Pelosi and filed on July 2), made an initial $4.8 million gain from Alphabet’s rising share price, and has since seen his gain grow to $5.3 million.

Paul bought the stock by exercising a call option, which allows investors to speculate on stocks they do not own by entering into a contract that allows them to buy a stock at a later date at a promised price. The upshot: a call option is a good tool for an investor who believes the stock price will go up in the future. In Pelosi’s case, the call options he’d previously bought for Alphabet (which were due to expire the day of his purchase) allowed him to buy it at $1,200 a share while the shares closed that day just over $2,500, a difference that accounted for his profit.

Paul Pelosi also reported buying call options for Amazon, Apple and NVIDIA, but he did not report exercising them.

Nancy Pelosi’s spokesperson said “The speaker has no involvement or prior knowledge of these transactions,” in an emailed statement on Wednesday, adding that Speaker Pelosi doesn’t own any stock.

Capitol gains
Great stock timing in DC isn’t exactly novel. Republican senators Richard Burr and Kelly Loeffler had inside knowledge of the impending COVID-19 crisis when they sold shares in January 2020.

Burr sold $1.7 million worth of stock holdings, while the former senator, Loeffler, wife of New York Stock Exchange chairman Jeffrey Sprecher and richest member of Congress at the time, unloaded up to $3.1 million worth of stock after getting closed-door briefings on the COVID-19 threat.

It is illegal for Congress members to trade based on non-public information gathered during their official duties, but it is hard to charge members of Congress with insider trading. Neither Burr not Loeffler faced any charges following inquiries.

But while it is hard to prosecute politicians over such stock sales, Twitter is less forgiving. ‘Nancy Pelosi Insider Trading’ began to trend on the social media service and people have called for her removal from office.

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