Senate Intelligence Committee Chairman Richard Burr (R-N.C.), who had expressed confidence in the country’s preparedness for the coronavirus outbreak, sold a significant share of his stocks last month, according to public disclosures.
Until about a week ago, President Trump and GOP leaders had projected optimism in the country’s ability to manage the global outbreak of the coronavirus.
Burr’s sales were among those of several senators to come to light late Thursday, raising questions about whether they were influenced by private briefings on the outbreak that in subsequent weeks caused U.S. equity markets to plunge.
Also under scrutiny were sales by Sen. Kelly Loeffler (R-Ga.) and her husband, Jeffrey Sprecher, the chairman of the New York Stock Exchange, as well as Sens. Dianne Feinstein (D-Calif.) and James M. Inhofe (R-Okla.).
As head of the powerful Intelligence Committee, Burr reportedly was receiving daily briefings on the threat of the virus. In mid-February, he sold 33 stocks held by him and his spouse, estimated at between $628,033 and $1.72 million, Senate financial disclosures show. It was the largest number of stocks he had sold in one day since at least 2016, records show. The Feb. 13 stock sales were first reported by the Center for Responsive Politics.
Then, at a Feb. 27 luncheon, Burr compared the potential impact of the novel coronavirus to the deadly 1918 flu pandemic. His remarks at the private event were obtained by NPR and aired Thursday.
His remarks prompted scrutiny over whether Burr had offered a more frank warning at a Capitol Hill event sponsored by North Carolina business leaders than he and his colleagues were sharing more broadly.
“There’s one thing I can tell you about this: It is much more aggressive in its transmission than anything we have seen in recent history,” Burr said, according to the NPR recording, which was not disputed by his staff. “It’s probably more akin to the 1918 pandemic.”
Burr’s office declined to answer specific questions about his stock sales. About a week after those sales, the stock market sharply declined.
“Sen. Burr filed a financial disclosure form for personal transactions made several weeks before the U.S. and financial markets showed signs of volatility due to the growing coronavirus outbreak,” said a statement from Burr’s office.
“As the situation continues to evolve daily, he has been deeply concerned by the steep and sudden toll this pandemic is taking on our economy. He supported Congress’ immediate efforts to provide $7.8 billion for response efforts and this week’s bipartisan bill to provide relief for American business and . . . families,” the statement said.
Loeffler sold stocks worth millions of dollars shortly after she and her colleagues on the Senate Health Committee attended a private briefing from administration officials on the public health threat posed by the virus, the Daily Beast first reported.
On the same day, Loeffler reported the first sale of stocks jointly owned by her and her husband, valued at between $50,001 and $100,000.
In the following weeks, she went on to sell 26 other holdings in companies like ExxonMobil and Auto Zone, many of which have seen their share price fall significantly as the pandemic wreaks havoc on markets. She did, however, purchase shares in a company that sells teleworking software.
“This is a ridiculous and baseless attack,” Loeffler said on Twitter early on Friday. “I do not make investment decisions for my portfolio. Investment decisions are made by multiple third-party advisers without my or my husband’s knowledge or involvement.”
According to the New York Times, two other senators, Feinstein and Inhofe, also sold significant holdings around the same time.
A Feinstein spokesman said Friday that the transactions in question were made by her spouse.
“All of Senator Feinstein’s assets are in a blind trust, as they have been since she came to the Senate. She has no involvement in any of her husband’s financial decisions,” said Feinstein spokesman Tom Mentzer.
Inhofe said in a statement Friday that he had not attended a Jan. 24 Senate briefing on the coronavirus outbreak and has no involvement in his investment decisions.
Shortly after becoming chairman of the Senate Armed Services Committee in December 2018, Inhofe said, “I instructed my financial adviser to move me out of all stocks and into mutual funds to avoid any appearance of controversy.”
Federal officials are barred by law from using the nonpublic information they learn in their positions for their private financial gain.
Insider trading prohibitions apply to all members of Congress, congressional staff and other federal officials, under the Stop Trading on Congressional Knowledge (STOCK) Act of 2012. Burr was among three senators who voted against the legislation at the time.
Under the law, officials must publicly disclose stock sales within 45 days after the transaction. Though the reported date of the 33 transactions in Burr’s financial disclosure is Feb. 13, it is unclear whether all the stocks were sold on that date, and Burr’s office declined to clarify.
Government watchdogs said they were concerned about Burr’s comments and stock sales, which they said deserve closer scrutiny and should prompt a Senate ethics investigation.
“We have huge concerns with this ethically. As a senator, he has a responsibility to his constituents first. The idea that he might be profiting off insider information is problematic,” said Lisa Gilbert, vice president of legislative affairs of the good-government group Public Citizen.
On Feb. 7 — less than a week before the reported date of those sales — Burr played down the virus’s threat, co-writing a column saying that while Americans are right to be worried, the United States was “better prepared than ever before to face emerging public health threats, like the coronavirus, in large part due to the work of the Senate Health Committee, Congress, and the Trump Administration.”
Even three weeks later, GOP lawmakers and Trump continued to project confidence that the virus’s outbreak was being managed.
On Feb. 27, Trump publicly predicted that the coronavirus would one day disappear “like a miracle.”
Yet on the same day, Burr attended the private event and warned attendees of some consequences of the coronavirus that have since materialized.
“Every company should be cognizant of the fact that you may have to alter your travel,” he told the gathering, according to the NPR report. “You may have to look at your employees and judge whether the trip they’re making to Europe is essential or can be done on videoconference.”
Burr’s office disputed characterizations that the senator’s public and private comments at the time were at odds.
“Sen. Burr has been banging the drum about the importance of public health preparedness for more than 20 years,” Burr spokeswoman Caitlin Carroll said Thursday. “His message has always been, and continues to be, that we must be prepared to protect American lives in the event of a pandemic or bio-attack. Since early February, whether in constituent meetings or open hearings, he has worked to educate the public about the tools and resources our government has to confront the spread of coronavirus. At the same time, he has urged public officials to fully utilize every tool at their disposal in this effort.”
In another statement highlighted by Burr’s office, he reacted on March 3 to the first reported coronavirus case in North Carolina.
“The U.S. is in a better position than any other nation to handle a public health emergency like coronavirus,” Burr said. “But Congress must continue working to make sure first responders have the resources they need and the federal government is using all the tools at its disposal to stem the problem.”