BUREAUCRATS GETTING RICH ON INSIDER TRADING
The richest counties in America are the ones that surround Washington, D.C. The high-income people who live in those suburbs are mostly lobbyists, lawyers, consultants, and others who profit from trillions in government spending. But an investigation by the Wall Street Journal suggests that plenty of high-level bureaucrats are also profiting improperly from their government jobs.
Thousands of officials across the government’s executive branch reported owning or trading stocks that stood to rise or fall with decisions their agencies made, a Wall Street Journal investigation has found.
More than 2,600 officials at agencies from the Commerce Department to the Treasury Department, during both Republican and Democratic administrations…
Sure, but the overwhelming majority of senior career bureaucrats are Democrats.
…disclosed stock investments in companies while those same companies were lobbying their agencies for favorable policies. That amounts to more than one in five senior federal employees across 50 federal agencies reviewed by the Journal.
A top official at the Environmental Protection Agency reported purchases of oil and gas stocks. The Food and Drug Administration improperly let an official own dozens of food and drug stocks on its no-buy list. A Defense Department official bought stock in a defense company five times before it won new business from the Pentagon.
The potential for such conflicts of interest on the part of senior agency employees is obvious. A Defense Department official knows that a contractor is likely to be awarded a big contract–or, worse, is the person who decides on the contract–and buys its stock. An FDA employee knows that the agency’s staff is critical of an important new pharmaceutical product and shorts that company’s stock. An EPA official is being heavily lobbied for a permit. He buys the company’s stock and then approves the permit.
• More than five dozen officials at five agencies, including the Federal Trade Commission and the Justice Department, reported trading stock in companies shortly before their departments announced enforcement actions, such as charges and settlements, against those companies.
• More than 200 senior EPA officials, nearly one in three, reported investments in companies that were lobbying the agency. EPA employees and their family members collectively owned between $400,000 and nearly $2 million in shares of oil and gas companies on average each year between 2016 and 2021.
• At the Defense Department, officials in the office of the secretary reported collectively owning between $1.2 million and $3.4 million of stock in aerospace and defense companies on average each year examined by the Journal. Some held stock in Chinese companies while the U.S. was considering blacklisting the companies.
• About 70 federal officials reported using riskier financial techniques such as short selling and options trading, with some individual trades valued at between $5 million and $25 million. In all, the forms revealed more than 90,000 trades of stocks during the six-year period reviewed.
It appears that little attention is paid to financial conflicts:
Within federal agencies, ethics officials generally don’t consider it their job to investigate whether employees are making stock trades based on information they glean from their government jobs. Ethics officials’ ability to spot potential conflicts is limited because they usually don’t know what employees are working on.
When ethics officials do see a potential violation, they can refer it to their agencies’ inspectors general, who refer cases on to the Justice Department if they find evidence of wrongdoing.
A Journal review of inspector general reports showed that the offices rarely investigated financial conflicts. As more federal officials invest in the stock market, ethics officials say they have less time to look into possible wrongdoing. When findings have been referred to the Justice Department, prosecutors in most cases have declined to open an investigation.
Much more at the link, including a number of individual cases.
It has come to light that Anthony Fauci has become a rich man despite working for the government since the Lyndon Johnson administration. Evidently he is not the only one who has found federal service to be more lucrative than one might assume.
https://www.powerlineblog.com/archives/2022/10/bureaucrats-getting-rich-on-insider-trading.php
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