Congressmen profited from inside information in the collapse?

posted at 1:35 pm on June 29, 2009 by Ed Morrissey

The Culture of Corruption continues!  The Cleveland Plain Dealer conducted a review of disclosure statements from members of the House Financial Services Committee, and guess who made a killing on bank stocks while Congress debated bailing out the financial sector?

As financial markets tumbled and the government worked to stave off panic by pumping billions of dollars into banks last fall, several members of Congress who oversee the banking industry were grabbing up or dumping bank stocks.

Anticipating bargains or profits or just trying to unload before the bottom fell out, these members of the House Financial Services Committee or brokers on their behalf were buying and selling stocks including Bank of America and Citigroup — some of the very corporations their committee would later rap for greed, a Plain Dealer examination of congressional stock market transactions shows.

The Gordon Gekko Club in the House includes both Republicans and Democrats — although you may not know that from the CPD report.  Check out how they mention Ohio’s Charlie Wilson, a Democrat, as compared to their reporting on a Republican from the same committee:

Financial disclosure records show that some of these Financial Services Committee members, including Ohio Rep. Charlie Wilson, made bank stock trades on the same day the banks were getting a government bailout from a program Congress approved. …

For example, Rep. Ginny Brown-Waite, a Florida Republican, bought Citigroup stock valued between $1,001 and $15,000 on Oct. 2, the day before the House passed the financial rescue bill and President George W. Bush signed it into law, records show. She opposed the bill.

Name That Party!  It takes four more paragraphs for the CPD to remind readers that Wilson is a Democrat.  They improve later as they mention the other characters in this little inside-information ring:

  • Carolyn McCarthy (D-NY)
  • Jackie Speier (D-CA)
  • Shelly Moore Capito (R-WV)
  • Judith Biggert (R-IL)

Of the five women, at least two of them — Capito and Speier — blame their spouses for their transactions.  But where did the spouses get their information?

The people who serve on this committee and its analog in the Senate should have their portfolios in blind trusts.  The US prosecuted inside-information traders in the 1980s and 1990s for similar transgressions, and the people trusted with power should have much more accountability for their actions.  We didn’t elect them to position themselves to profit while the rest of us lost big chunks of our retirement funds.  We can’t expect the House to clean its own house on this matter, but we can point out that Nancy Pelosi promised to end the “culture of corruption” — and instead it looks as though it has positively flourished under her leadership.  (via TMV)


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You do not mention Democrats with corruption or fraud. Didn’t you get the J-School memo on that Ed. Jeez. It could mess things up.

Mr. Joe on June 29, 2009 at 1:39 PM

Carolyn McCarthy (D-NY)
Jackie Speier (D-CA)
Shelly Moore Capito (R-WV)
Judith Biggert (R-IL)

You voted them in, now vote them out.

upinak on June 29, 2009 at 1:40 PM

The best politicians money can buy….

DL13 on June 29, 2009 at 1:40 PM

Now that is what I call bipartisianship.

Just A Grunt on June 29, 2009 at 1:41 PM

I must be looking at this wrong. What’s Citigroup worth now?

Cindy Munford on June 29, 2009 at 1:42 PM

Shelly Moore Capito? Damn. I honestly thought she was going to be different than her father.

myrenovations on June 29, 2009 at 1:42 PM

I’ve become numb to all of this. The ruling class has finally come out from hiding. The fact that they have no shame is telling. Time to look after your own now. For those who think you can make it until the next election, good luck.

genso on June 29, 2009 at 1:42 PM

upinak on June 29, 2009 at 1:40 PM

Yep. They all should go.

ladyingray on June 29, 2009 at 1:43 PM

For example, Rep. Ginny Brown-Waite, a Florida Republican, bought Citigroup stock valued between $1,001 and $15,000 on Oct. 2, the day before the House passed the financial rescue bill and President George W. Bush signed it into law, records show. She opposed the bill.

What’s a Republican woman doing with a hyphenated last name??!! I thought only lefty Commie Pinko feminists and their weak no stones husbands did that.

Jeff from WI on June 29, 2009 at 1:44 PM

do you think we’ll see this in the MSM? /sarc

cmsinaz on June 29, 2009 at 1:44 PM

Hell, at this point the Roman Senate looks like a tower of propriety.

Limerick on June 29, 2009 at 1:45 PM

I’ve become numb to all of this. The ruling class has finally come out from hiding. The fact that they have no shame is telling. Time to look after your own now. For those who think you can make it until the next election, good luck.

genso on June 29, 2009 at 1:42 PM

Me, too. I think that is their goal. Isn’t that how an abuser gets control over its victim. Keep hitting and striking from all sides until you just lay down and take it.

ihasurnominashun on June 29, 2009 at 1:46 PM

Not a chance in H#!! of any of the Democrats being prosecuted.

The Republicans on the other hand are toast.

MarkTheGreat on June 29, 2009 at 1:46 PM

….we can point out that Nancy Pelosi promised to end the “culture of corruption” — and instead it looks as though it has positively flourished under her leadership.

the MSM will never pick it up…

*sigh*

cmsinaz on June 29, 2009 at 1:46 PM

Can you say “Martha Stewart”?

Big John on June 29, 2009 at 1:47 PM

We can’t expect the House to clean its own house on this matter, but we can point out that Nancy Pelosi promised to end the “culture of corruption” — and instead it looks as though it has positively flourished under her leadership. (via TMV)

nazi pelosi was suppose to empty the swamp of curruption, instead she added more snakes… her being the queen of course…

SHARPTOOTH on June 29, 2009 at 1:47 PM

This makes my head hurt…

ladyingray on June 29, 2009 at 1:47 PM

The best politicians money can buy….

DL13 on June 29, 2009 at 1:40 PM

I want my money back.

NeighborhoodCatLady on June 29, 2009 at 1:48 PM

Yet again proving that the media doesn’t give a damn about corruption.

spmat on June 29, 2009 at 1:49 PM

Shelly Moore Capito? Damn. I honestly thought she was going to be different than her father.

myrenovations on June 29, 2009 at 1:42 PM

Me too. Very disappointing b/c so far she’s been very strong on the issues.

hollygolightly on June 29, 2009 at 1:49 PM

Of the five women, at least two of them — Capito and Speier — blame their spouses for their transactions.

The serpent made me do it.

whitetop on June 29, 2009 at 1:50 PM

Rep. = Rep.ublican. Right?

LibTired on June 29, 2009 at 1:51 PM

Buy stock in pitchforks!

Disturb the Universe on June 29, 2009 at 1:51 PM

It’s time for Congress to put their finances in a blind trust, it’s hard for me to believe it isn’t already mandaged.

Cindy Munford on June 29, 2009 at 1:52 PM

Maybe I was wrong, but I had the impressiion that insider trading was illegal. Isn’t that right Mr. Milkin?

Mr. Grump on June 29, 2009 at 1:52 PM

Beyond parody.

Give a person or body too much power, and corruption inevitably follows, as the day follows the night.

Flyover Country on June 29, 2009 at 1:53 PM

So congress drags GM, Ford, Chrysler, AIG, BoA, and others out into the arena, throws stones, and then goes to their offices to check their e-Trade account?

And the people go about mooing and munching the grass.

Limerick on June 29, 2009 at 1:56 PM

Democrat corruption? Hey look, Michael Jackson died!

Cicero43 on June 29, 2009 at 1:58 PM

hollygolightly on June 29, 2009 at 1:49 PM

Shelly husband, Charlie, has been with Citi and its predecessor for decades. He’s a very bright guy and has his own sources of information. I assume he makes his own choices in his investments and knows a bargain when he sees it.

Shelly has been a class act. Be careful not to prejudge her.

clorensen on June 29, 2009 at 1:58 PM

Female congress members: “I plead girlism.”

But they’re feminists, right?

PattyJ on June 29, 2009 at 1:59 PM

Shelly husband, Charlie, has been with Citi and its predecessor for decades. He’s a very bright guy and has his own sources of information. I assume he makes his own choices in his investments and knows a bargain when he sees it.

Shelly has been a class act. Be careful not to prejudge her.

clorensen on June 29, 2009 at 1:58 PM

I tend to believe your assessment, but she still ends up in the article and it is still going to hurt her.

myrenovations on June 29, 2009 at 2:00 PM

Maybe I was wrong, but I had the impressiion that insider trading was illegal. Isn’t that right Mr. Milkin?

Mr. Grump on June 29, 2009 at 1:52 PM

Didn’t Martha Stewart go to prison for less than this?

Disturb the Universe on June 29, 2009 at 2:01 PM

These idiots forgot who they work for. FIRE THEM!

gatorboy on June 29, 2009 at 2:02 PM

Didn’t Martha Stewart go to prison for less than this?

Disturb the Universe on June 29, 2009 at 2:01 PM

she did, but then again, she wasn’t part of the ruling class, now was she?

gatorboy on June 29, 2009 at 2:02 PM

Didn’t Martha Stewart go to prison for less than this?

Disturb the Universe on June 29, 2009 at 2:01 PM

She was investigated for less. But she went to jail for lying to investigators, not insider trading.

myrenovations on June 29, 2009 at 2:02 PM

Shelly has been a class act. Be careful not to prejudge her.

clorensen on June 29, 2009 at 1:58 PM

Yeah, I’ll definitely wait this one out b/c I’ve never written to her on any issue without getting a quick and relevant response (ie, not just form letters). She was very strong on Shamnesty and Cap and Trade.

hollygolightly on June 29, 2009 at 2:03 PM

She was investigated for less. But she went to jail for lying to investigators, not insider trading.

myrenovations on June 29, 2009 at 2:02 PM

It’s always the cover-up that gets them. Considering these are politicians, it’s nearly granted they will lie, too.

Disturb the Universe on June 29, 2009 at 2:07 PM

Remember, folks: Only Republicans are corrupt.

ZK on June 29, 2009 at 2:12 PM

Awesome, the Roman Senate is just making sure the flow of sesterces into their personal coffers is unimpeded.

Who is Spartacus?

Bishop on June 29, 2009 at 2:17 PM

Stupid question I know but is there such thing as an honest politician?

FontanaConservative on June 29, 2009 at 2:19 PM

Stupid question I know but is there such thing as an honest politician?

FontanaConservative on June 29, 2009 at 2:19 PM

It’s only stupid from the standpoint that it even arises. But, it’s not your stupidity…only the politicians. We just have to pay for it.

genso on June 29, 2009 at 2:24 PM

I bet this really pisses Martha Stewart off?

Col.John Wm. Reed on June 29, 2009 at 2:27 PM

Me, too. I think that is their goal. Isn’t that how an abuser gets control over its victim. Keep hitting and striking from all sides until you just lay down and take it.

ihasurnominashun on June 29, 2009 at 1:46 PM

There are only 2 ways to stop/reverse this. The legal way is nigh improbable….the illegal way is unconscionable.

genso on June 29, 2009 at 2:28 PM

All of the thieves need to be voted out!

grapeknutz on June 29, 2009 at 2:29 PM

this is far a worse “trip” than the best of the ’70′s acid coulda taken you on!

stacy on June 29, 2009 at 2:43 PM

Shelly Moore Capito? Damn. I honestly thought she was going to be different than her father.

myrenovations on June 29, 2009 at 1:42 PM

Arch Moore was a crooked son of a gun. There was at least one book written on it, but a quick Google search turned this up:

Former Mingo County political boss Johnie Owens said Moore once lay down in the back seat of a car, to avoid being seen by passers-by, and “held up $12,000 and begged me to take it” to induce the county Democratic machine to support the Republican governor in an election.

Controversial coal operator Paul Kizer testified that he and Moore hid in a parked car at night behind Charleston’s abandoned incinerator to agree on perjury they could tell to federal investigators.

SNIP

In our furtive meeting, he said the tax evidence against Moore had been powerful, involving $200,000 in unreported income. He said the lawyer-politician had been executor of the estate of a crotchety hermit, and had found a signed, blank “certificate of assignment” in the hermit’s safety box – so he wrote in stock numbers and gave himself 900 Exxon shares from the old man’s assets. Also, he said, Moore converted $80,000 in campaign funds to personal use, and didn’t report $6,000 from a land deal in which a mental defective was cheated out of a fair share.

alliebobbitt on June 29, 2009 at 2:44 PM

John McClean for Pres .

LSUMama on June 29, 2009 at 2:48 PM

Stupid question I know but is there such thing as an honest politician?

FontanaConservative on June 29, 2009 at 2:19 PM

I’m beginning to think that there are none, only those who haven’t yet been caught or exposed.

Jvette on June 29, 2009 at 2:49 PM

It’s 2:51pm. EST.

I need a beer.

Key West Reader on June 29, 2009 at 2:51 PM

Nancy Pelosi didn’t “drain the swamp”. She skinny dipped in it!

SouthernGent on June 29, 2009 at 2:52 PM

Nancy Pelosi didn’t “drain the swamp”. She skinny dipped in it!

SouthernGent on June 29, 2009 at 2:52 PM

Oh. That’s nasty.

Key West Reader on June 29, 2009 at 2:53 PM

Key West Reader on June 29, 2009 at 2:51 PM

Its 5 oclock somewhere…

ladyingray on June 29, 2009 at 3:02 PM

This is the tip of the iceberg. Its infuriating. Corruption is rampant in our government and many of the appointees and czars are in on it. If you are really interested in this, read this link from Instapundit. If you have the time, read through the comments in that article for a real education. Also, who is going to profit from Cap and Trade? A few names have already come up – those in Congress who bought stock in energy companies. This is what we should be watching instead of focusing on sex scandals. Trying to vote these people out may not work since the MSM is not going to make a fuss about this the way they did when Martha did it. I think a lot of the scandals that come out in the press are engineered to discredit those who have gone after the crooks on Wall St and elsewhere (i.e., Spitzer). Not that the scandals aren’t true, but why are they uncovered when they are? And are we doing ourselves more harm than good when we throw some of these guys out of office due to sex scandals? Was Sanford’s “outing” a form of payback?

mph on June 29, 2009 at 3:07 PM

Wouldn’t it be a good idea to just remove ALL of them, no matter how “good” they apear to be or how much “work” they’ve done on issues.

NONE of them are honest, NONE of them are clean, NONE of them listen anymore. Sure some of them ocasionally do the right thing but to often they do it just for cover in the next election.

Honestly if the pope was in congress right now I would STILL vote him out because as long as any of them remain the coruption and dishonesty will continue.

Unfortunately there are far to many people who actually believe that “their” rep is good and it’s “those other ones” who are bad and so this situation continues perpetually.

As long as ANY of them who are currently in office remain we will never see this parade of idiocy end. Personally I would love to see EVERY SINGLE ONE OF THEM arrested and taken to jail for what they have done either by ommission or deed.

FIRE ALL OF THESE CRIMINALS!!

I will NEVER vote for an incubant again, no matter how “good” a job he has claimed to have done. Every bill, every law, every regulation, is so loaded with deals to their friends and payoff’s to supporters that its sikening!

ALL OF THEM ARE THIEVES AND LIARS!!

babydoll4you on June 29, 2009 at 3:18 PM

John McClean for Pres .

LSUMama on June 29, 2009 at 2:48 PM

Sorry I meant John MaClane!

LSUMama on June 29, 2009 at 3:35 PM

Not a chance in H#!! of any of the Democrats being prosecuted.
The Republicans on the other hand are toast.
MarkTheGreat on June 29, 2009 at 1:46 PM

Reminds me of this exchange in “Braveheart”:

William Wallace [Mel Gibson]: “So, what does your god tell you about our situation?” [Referring to impossible odds prior to a battle with the English army.]
Stephen (The Crazy Irishman): “The Almighty tells me he can get me out of this mess… but he’s pretty sure you’re f–ked !”

ReagansRight on June 29, 2009 at 3:40 PM

Nancy was only against the REPUBLICAN culture of corruption. Nuance, Edward, NUANCE.

GarandFan on June 29, 2009 at 3:59 PM

Charlie Wilson’s War wore . . .
.
.
.
out his welcome.

Mark30339 on June 29, 2009 at 5:11 PM

It could probably be shown by facts and figures that there is no distinctive native criminal class …. …. except congress.
- Mark Twain

MB4 on June 29, 2009 at 5:54 PM

We didn’t elect them to position themselves to profit while the rest of us lost big chunks of our retirement funds.

Translation: They took our money for their own ends. But this is normal Democratic behavior — what’s ours is theirs, and what’s theirs is theirs too.

unclesmrgol on June 29, 2009 at 6:20 PM

the 5 criminals should go to jail.

but of course, every other member of congress should be in jail as well.

notagool on June 29, 2009 at 6:20 PM

Not a chance in H#!! of any of the Democrats being prosecuted.
The Republicans on the other hand are toast.
MarkTheGreat on June 29, 2009 at 1:46 PM

Reminds me of this exchange in “Braveheart”:

William Wallace [Mel Gibson]: “So, what does your god tell you about our situation?” [Referring to impossible odds prior to a battle with the English army.]
Stephen (The Crazy Irishman): “The Almighty tells me he can get me out of this mess… but he’s pretty sure you’re f–ked !”

ReagansRight on June 29, 2009 at 3:40 PM

You’re a daisy if you do ReagansRight

Jeff from WI on June 29, 2009 at 6:25 PM

No wonder Republicans are being so quiet, and meek about things going to hell. They’re in bed with this crap, and as guilty as the next guy. Damn!

capejasmine on June 29, 2009 at 6:32 PM

Okay, so this is a PRIME example why government should stay OUT of private business. Who thought that letting government officials, who by the very nature of politics are corrupt, control private businesses would be a good idea? Oh, yeah, Obama. Hate to say it, but told you so.

Unfit For The Internet on June 29, 2009 at 7:23 PM

Well, ladies and gentlemen, we’re not here to indulge in fantasy, but in political and economic reality. America, America has become a second-rate power. Its trade deficit and its fiscal deficit are at nightmare proportions. Now, in the days of the free market, when our country was a top industrial power, there was accountability to the stockholder. The Carnegies, the Mellons, the men that built this great industrial empire, made sure of it because it was their money at stake. Today, management has no stake in the company!

All together, these men sitting up here [Teldar management] own less than 3 percent of the company. And where does Mr. Cromwell put his million-dollar salary? Not in Teldar stock; he owns less than 1 percent.

You own the company. That’s right — you, the stockholder.

And you are all being royally screwed over by these, these bureaucrats, with their steak lunches, their hunting and fishing trips, their corporate jets and golden parachutes.

Teldar Paper, Mr. Cromwell, Teldar Paper has 33 different vice presidents, each earning over 200 thousand dollars a year. Now, I have spent the last two months analyzing what all these guys do, and I still can’t figure it out. One thing I do know is that our paper company lost 110 million dollars last year, and I’ll bet that half of that was spent in all the paperwork going back and forth between all these vice presidents.

The new law of evolution in corporate America seems to be survival of the unfittest. Well, in my book you either do it right or you get eliminated.

In the last seven deals that I’ve been involved with, there were 2.5 million stockholders who have made a pretax profit of 12 billion dollars. Thank you.

I am not a destroyer of companies. I am a liberator of them!

The point is, ladies and gentleman, that greed — for lack of a better word — is good.

Greed is right.

Greed works.

Greed clarifies, cuts through, and captures the essence of the evolutionary spirit.

Greed, in all of its forms — greed for life, for money, for love, knowledge — has marked the upward surge of mankind.

And greed — you mark my words — will not only save Teldar Paper, but that other malfunctioning corporation called the USA.

Most people don’t actually remember what Gordon Gekko actually said but in today’s business landscape where Obama is actually promoting survival of the unfittest via (unnatural) government selection these arguments are still actually quite responsible. (Of course Obama is like Gekko in sometimes saying one thing and doing another — but the infamous, ‘Greed is good,’ speech has gotten a bad rap over the years.)
David

LifeTrek on June 29, 2009 at 7:25 PM