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BREAKING: New AP Investigation Uncovers More “Suspicious” Stock Trading By Senator David Perdue

Associated Press Headline: “With US In COVID-19 Panic, Sen. Perdue Saw Stock Opportunity

Legal Experts Say “Impeccable” Timing Of Perdue Dumping And Buying Stock This Year “Warrant Scrutiny” As Reports Of Shady Self-Dealing Grow With New Bombshell Report

Just days after reports revealed that Senator David Perdue “engaged in conspicuously timed trading,” a new bombshell Associated Press report uncovered that Perdue made even more “suspicious” stock transactions this year. Senator Perdue dumped stock in the Georgia-based financial tech company Cardlytics right before its value tanked, and then bought back stock weeks later following the company’s “unexpected leadership shakeup.” The value of the stock has since quadrupled.

Before becoming a Senator, Perdue served on the board of Cardlytics and remains close with its executives – raising further questions about the “impeccable” timing of his stock trading that reaped this “stunning gain.” Legal experts told the AP that “the timing of his sale, the fact that he quickly bought Cardlytics stock back when it had lost two-thirds of its market value and his close ties to company officials all warrant scrutiny.”

“Senator Perdue continues to make clear he’s a self-serving politician whose only concern in Washington is enriching himself,” said DSCC spokesperson Helen Kalla. “For too long, Senator Perdue has refused to explain and answer for his shady self-dealing and flagrant corruption as he maneuvers for his own personal profit. As scrutiny grows of his suspicious transactions, Senator Perdue will have to answer to voters for putting his stock portfolio ahead of hardworking Georgia families during this pandemic.”

IN CASE YOU MISSED IT

Associated Press: With US in COVID-19 panic, Sen. Perdue saw stock opportunity
By Brian Slodysko and Richard Lardner
November 25, 2020

Key Points:

  • As the ravages of the novel coronavirus forced millions of people out of work, shuttered businesses and shrank the value of retirement accounts, the Dow Jones Industrial Average plunged to a three-year low. But for Sen. David Perdue, a Georgia Republican, the crisis last March signaled something else: a stock buying opportunity.
  • And for the second time in less than two months, Perdue’s timing was impeccable. He avoided a sharp loss and reaped a stunning gain by selling and then buying the same stock: Cardlytics, an Atlanta-based financial technology company on whose board of directors he once served.
  • On Jan. 23, as word spread through Congress that the coronavirus posed a major economic and public health threat, Perdue sold off $1 million to $5 million in Cardlytics stock at $86 a share before it plunged, according to congressional disclosures.
  • Weeks later, in March, after the company’s stock plunged further following an unexpected leadership shakeup and lower-than-forecast earnings, Perdue bought the stock back for $30 a share, investing between $200,000 and $500,000.
  • Those shares have now quadrupled in value, closing at $121 a share on Tuesday.
  • Now that Perdue is locked in a pitched battle for reelection in a Jan. 5 runoff, his trades during a public health and economic crisis have become an issue in what already has become a negative, expensive campaign that will determine which party controls the Senate.
  • But legal experts say the timing of his sale, the fact that he quickly bought Cardlytics stock back when it had lost two-thirds of its market value and his close ties to company officials all warrant scrutiny.
  • “This does seem suspicious,” said John C. Coffee Jr., a Columbia University law school professor who specializes in corporate and securities issues.
  • Perdue’s opponent, Democrat Jon Ossoff, has seized on his stock trading while trying to brand him as a “crook.”
  • Perdue’s Cardlytics transactions fit into a broader pattern of stock moves he made when the coronavirus first struck the U.S.
  • At the time, Perdue publicly maintained that the economy was strong and praised President Donald Trump during a Feb. 24 interview on Fox News Channel for “executing the greatest economic turnaround in U.S. history.”
  • A series of swift transactions in his portfolio told a different story, however, showing the senator dumped some company stocks, while investing in others — like protective equipment maker DuPont and pharmaceutical company Pfizer — that were poised to do well during the pandemic.
  • Perdue has previously said that outside financial advisers make most of his trades. But Donna Nagy, an Indiana University law professor, said that type of arrangement doesn’t preclude Perdue from directing an adviser to make specific transactions. She said one way for members of Congress to avoid questions about their financial holdings is to put them in a blind trust, which Perdue has not done.
  • “All of these questions about the motivations behind our members of Congress and their personal securities trading could be alleviated if Congress passed a law that limited investments,” said Nagy, who specializes in securities law. “Ordinary citizens should not have to question members of Congress about their investments.”
  • The issue was enough of a liability that Perdue abruptly sold off between $3.2 million and $9.4 million of his stock portfolio over a four-day period in mid-April, according to an Associated Press review of mandatory financial disclosures he has submitted to the Senate. He did not sell his stock in Cardlytics.
  • The company did not respond to a request for comment.
  • After the March turmoil, its share price dramatically rebounded. Lynne Laube, Cardlytics’ current CEO, said the pandemic had a lot to do with it, driving consumer interest in savings programs. “I hate to say this pandemic is playing in our favor, but it’s playing in our favor,” she said during an earnings call in May.
  • Perdue acquired 75,000 shares in Cardlytics through stock options offered for his service on the company’s board from 2010 to 2014, when he stepped down after winning his Senate seat, Securities and Exchange Commission filings show. The company, which at the time had not yet gone public, also offered him options that would become available in October 2020 and January 2022.
  • But according to Coffee, the Columbia University law professor, it’s an unusual move by the company. “I’ve never seen options extended from 2014 to 2022,” he said. “That’s a very long extension.”
  • While Perdue left the company’s board, he has maintained ties to some of its executives, who have donated more than $30,000 to his political committees. Donations made to Perdue account for nearly 80% of all giving to federal candidates by Cardlytics employees over the past decade, records show.

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