Those in Power (And Already Uber Rich) Are Entitled: “Perhaps That's the Story of Life." Trump, March 18, 2020

Untitled, Acrylic on Panel, 18" x 24 ", Richard J Van Wagoner, Courtesy of Van Wagoner Family Trust**

A month from now two runoff elections in Georgia will determine nothing less than control of the United States Senate and largely determine the country’s direction and progress for at least the next two years.

Senators trading on non-public information once again is at the fore. Also front and center is whether Senators Perdue and Loeffler—like Trump over the past four years—have exercised their oversight responsibilities with a focus toward increasing their personal net worth.

Perdue, as it turns out, is worth somewhere in the range of $14,900,000.00 - $42,600,000.00, according to financial disclosures. Loeffler, the wealthiest member of either house of Congress, is worth around $800,000,000.00. For both of them, enough may never be enough.

Trading on information unavailable to the market—which, if known, would influence a stock’s value—is a crime because it cheats other traders in the zero-sum game. The knowledge gives such traders an unfair opportunity to profit or avoid losses, to the detriment of others in the market who don’t have access to the same information. The large percentage of the population not invested in markets may have little concern about such criminal conduct. They should be concerned.

Membership in the Senate or Congress does not make one a corporate insider. Those jobs, however, give members access to non-public information, intelligence that, when released, will affect the price of stocks in which members, relatives or staff may be invested or interested. An elected official, say a United States senator, who trades on information to which that person is privy solely because of her position and oversight responsibilities cheats – defrauds – other market participants who lack access to such material information.

One would think they might see themselves as fiduciaries who took oaths to protect constituents, investors and markets; one would think they might act accordingly by refusing to self-deal or otherwise take financial advantage of information not yet released to the public to the detriment of the market and other investors.

One should think again.

Equally if not more significantly, if senators or congresspersons are willing to trade on non-public information to which they have access due to committee assignments or similar responsibilities, we should assume they are also willing to influence public policy and make oversight decisions with an eye toward optimizing a personal stock portfolio and increasing personal wealth.

Every citizen, every Georgian right now, should be concerned about such misconduct by their sitting United States senators. How can Georgians trust that senators who use their positions to get even filthier uber rich will make decisions in the overall public’s, or even Georgia’s, interests?

Does it come as any surprise that prior to April 2012, members of Congress traded on material nonpublic—inside—information? Such “investing” by members of Congress was both legal and common. Given the Senate’s green light to the current administration’s unprecedented corruption, perhaps the surprise is there was a time, long ago before America became great again, when Congress and a President actually took steps to curtail corruption, and it passed with overwhelming bipartisan support. Trading on such inside information by members of the Senate and Congress is now a crime.

The Stop Trading on Congressional Knowledge Act of Congress, also known as the STOCK Act, passed and President Obama signed it into law on April 4, 2012. Senator Burr, who joined a small group of potentially corrupt senators, we are reminded, was one of three senators to vote against its passage, while 96 of his colleagues voted in its favor. Perdue and Loeffler weren’t in the Senate by then to vote against it. Since its passage, which intended to create transparency of members’ financial increase and its source, Congress has backtracked, making reporting somewhat opaque and more difficult for the public to discern.

Congressional watchdogs are adept at locating and sifting through the haystacks. Fortunately for Georgians, the Senate Stock Watcher website, The New York Times, Mother Jones and other investigative reporting outlets have kept a close eye on the trading activities of Senators Perdue and Loeffler, wiping away much of the opacity (look it up, Rudy) the weakened disclosure requirements allow.

While Perdue and Loeffler, coincidentally, have traded stocks in their portfolios at just the right times, they deny any wrongdoing. The evidence suggests insider trading or, at a minimum, conflicts of interest.


“As a member of the Senate’s cybersecurity subcommittee, David Perdue has raised alarms that hackers from overseas pose a threat to U.S. computer networks. Citing a frightening report by a California-based company called FireEye, Mr. Perdue was among the senators who asked this spring that the National Guard prepare to protect against such data breaches.

“Not only was the issue important to Mr. Perdue, so was FireEye, a federal contractor that provides malware detection and threat-intelligence services. Beginning in 2016, the senator bought and sold FireEye stock 61 times, at one point owning as much as $250,000 worth of shares in the company. . . .

“Last week, The New York Times reported that the Justice Department had investigated the senator for possible insider trading in his sale of more than $1 million worth of stock in a financial-analysis firm, Cardlytics. Ultimately, prosecutors declined to bring charges. Other media outlets have revealed several trades in companies whose business dealings fall under the jurisdiction of Mr. Perdue’s committees.

“An examination of Mr. Perdue’s stock trading during his six years in office reveals that he has been the Senate’s most prolific stock trader by far, sometimes reporting 20 or more transactions in a single day.

“The Times . . . found that Mr. Perdue’s transactions accounted for nearly a third of all senators’ trades reported in the past six years. His 2,596 trades, mostly in stocks but also in bonds and funds, roughly equal the combined trading volume of the next five most active traders in the Senate.

The data also shows the breadth of trades Mr. Perdue made in companies that stood to benefit from policy and spending matters that came not just before the Senate as a whole, but before the committees and subcommittees on which he served.

“Nearly half of Mr. Perdue’s FireEye trades, for example, occurred while he sat on the cybersecurity panel, a role that potentially could have provided him with nonpublic information about companies like FireEye. During that period, FireEye landed a subcontract worth more than $30 million with the Army Cyber Command, which had operations at Fort Gordon, in Mr. Perdue’s home state. In 2018, Mr. Perdue reported capital gains of up to $15,000 from FireEye trades.

“And as a member of the Senate banking, housing, and urban affairs committee since 2017, Mr. Perdue bought and sold shares of a number of financial companies his panel oversaw, including JPMorgan Chase, Bank of America and Regions Financial.

“Mr. Perdue disputes the notion that his investment activity posed a conflict, saying that his trades were handled by outside advisers without his input, although his instructions to Goldman Sachs to sell Cardlytics suggest that he directed at least some trades.

“‘Senator Perdue doesn’t handle the day-to-day decisions of his portfolio — all of his holdings are managed by outside financial advisers who make recommendations, set strategy, and manage trades and personal finances,’ said John Burke, the communications director for the senator’s re-election campaign.

“. . . Mr. Perdue’s wealth manager at Goldman Sachs . . . declined to comment.

“In April, after questions were raised about stock trades that Mr. Perdue and other senators had made around the onset of the coronavirus pandemic, he abruptly sold virtually all of his stock holdings — between $3.2 million and $9.4 million worth. (Members of Congress report their transactions in ranges, so it is often impossible to pinpoint the exact dollar values.) In May, he announced that his advisers would no longer trade in individual stocks for his portfolio, with the exception of a few companies on whose boards he had previously served, including Cardlytics; the utility Alliant Energy; and Graphic Packaging, a paper-based-packaging provider.

“Though Mr. Perdue has been unusually active in stock trading, his robust investing activity highlights broader questions once again being debated, more than eight years after the passage of the STOCK Act, a law meant to grapple with the ethical issues inherent in lawmakers’ buying and selling stocks.

“While there is no law or regulation prohibiting such trading, the practice has long invited questions about possible conflicts — and the potential for insider trading — that can arise when members of powerful congressional committees buy and sell shares of companies directly affected by the issues before them. (By comparison, avoiding some or all individual stocks is common practice in other branches of government, where federal law prohibits most employees from engaging in matters whose outcomes may have financial implications for them.)

“‘Members are in a constant state of gathering information from briefings, hearings, constituent meetings, investigations and staff,’ said Aaron Cooper, special counsel to the law firm Jenner & Block who previously served as lead minority investigative counsel to the Senate Intelligence Committee. ‘They receive a massive amount of data every day — both public and nonpublic — and it’s not always clear which category the information belongs to.’

“‘As a result,’ he said, ‘prosecutors often face an uphill battle’ in making an insider-trading case against a member of Congress.’

“The trend on Capitol Hill was already moving away from individual stock holding when Mr. Perdue was elected in 2014. Many senators had reduced their trading in individual stocks after the 2012 STOCK Act, which prohibited members of Congress from trading on nonpublic information acquired in the course of their duties. An analysis by Public Citizen published in 2017 credited the legislation with a 50 percent decline in stock trading by senators.”


“On January 24, just three weeks into her Senate career, Loeffler attended a private Senate briefing by Dr. Anthony Fauci, director of the National Institute of Allergy and Infectious Diseases, and Dr. Robert Redfield, the head of the Centers for Disease Control, about the coronavirus threat. [Perdue was also present.] Afterward, Loeffler continued to publicly downplay the risk from the virus and its economic impact. But in the three weeks following the meeting, Loeffler and Sprecher made more than 20 stock sales amounting to between $1.25 million and $3.1 million. Loeffler also bought stock in two companies that produce teleworking software.

“Once markets began plummeting in late February, the couple sold $18.7 million in shares of Intercontinental Exchange stock in three separate deals. They also sold shares in retail stores like Lululemon and T.J. Maxx . . . .

“Loeffler has denied profiting off confidential information, and notes that her trading was investigated by the Senate Ethics Committee. The panel told Loeffler in a June letter it found ‘no evidence’ she broke the law or Senate rules. In an April Wall Street Journal op-ed where she promised ‘to end the distraction,’ the senator reiterated that her investments are managed by third party advisers, and claimed that the January 24 briefing included ‘no material or nonpublic information.’

“While Loeffler wrote that her household would ‘divest from individual stocks,’ her subsequent financial disclosure form showed that she kept $5 million to $25 million worth of Intercontinental Exchange stock, while her husband held on to at least $10 million worth of the company’s stock and options. As a member of the Senate Agricultural Committee, Loeffler helps oversee the Commodity Futures Trading Commission. That agency regulates Sprecher’s company, giving her influence over the performance of a firm in which she remains heavily invested. Upon joining the committee, Loeffler said she would ‘recuse myself if needed on a case by case basis.’ In May, she announced she was stepping down from a subcommittee with direct oversight of the CFTC in response to criticism, but she retained her seat on the full committee.”

Maybe Perdue and Loeffler simply have superpowers. Maybe they are both prescient and have the capacity to compartmentalize—and thereby make trading decisions solely on publicly available information—from the non-public material information they receive as members of the Senate and its committees and subcommittees.

Use of the non-public information they receive in their capacity as lawmakers in making investment decisions is clearly unethical and most likely a crime under the STOCK Act. The penalties for violation of the STOCK Act are not subtle. As noted in a summary of the STOCK Act provided by the Congressional Research Service:

“Under current law, if convicted of certain offenses relating to corruption in public office while serving as a Member, a Member of Congress forfeits all of his or her creditable service as a Member for federal pension purposes. This bill expands that provision so that a Member of Congress would lose the credit for service as a Member for pension purposes if convicted of one of the numerous corruption offenses not only during time served as a Member of Congress, but also if convicted of any of such offenses while the President [if only], the Vice President, or as an elected official of a state or local government. The STOCK Act also adds numerous other federal criminal laws for which a final felony conviction would result in losing creditable service as a Member of Congress for federal pension purposes. Such other criminal offenses include conflicts of interest (18 U.S.C. §203); conspiracy to make false claims (18 U.S.C. §286); making false claims to the government (18 U.S.C. §287); vote buying (18 U.S.C. §597); illegal solicitation of political contributions from federal employees (18 U.S.C. §602); soliciting political contributions in a federal building or office (18 U.S.C. §607); theft, conversion, or embezzlement of government funds or property (18 U.S.C. §641); false statements to the government (18 U.S.C. §1001); obstruction of proceedings . . . ."

All of this said, my strong suspicion is that members of Trump’s base in Georgia would prefer to elect or re-elect ethically or legally compromised incumbents over anyone who stands left of authoritarian fascism. The Democratic candidates in the two Georgia senate runoff elections, Ossoff and Warnock, come without such compromise by all appearances and are credible when promising they will represent Georgia over their personal financial interests.

*My brother the very talented fiction writer and novelist, Robert Hodgson Van Wagoner, deserves considerable credit for offering both substantive and technical suggestions to and Rob’s second novel, a beautifully written suspense drama that takes place in Utah, Wyoming and Norway, dropped on November17, 2020 fall. Available on Amazon, Barnes and Noble, Apple Bookstore and your favorite local bookshop, this novel, The Contortionists, which Rob himself narrates for the audio version, is a psychological page-turner about a missing child in a predominantly Mormon community.

**Richard J Van Wagoner is my father. His list of honors, awards and professional associations is extensive. He was Professor Emeritus (Painting and Drawing), Weber State University, having served three Appointments as Chair of the Department of Visual Arts there. He guest-lectured and instructed at many universities and juried numerous shows and exhibitions. He was invited to submit his work as part of many shows and exhibitions, and his work was exhibited in a number of traveling shows domestically and internationally. My daughter Angela Moore, a professional photographer, photographed more than 500 pieces of my father's work. On behalf of the Van Wagoner Family Trust, she is in the process of compiling a collection of his art work. The photographs of my father's art reproduced in and are hers


Natural US Citizen. Caucasian. Shamed into blogging by DSM-V Cluster B 9/9-led regime, Utah's most embarrassing congressperson, and Newton's Third Law of Motion. The views expressed are mine.

USA, Utah, Salt Lake City


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