Image Credit: distel.com
Atlanta, Georgia — Congressional Democrats are accusing Georgia’s Republican Senator David Perdue of committing insider trading. Members of Congress are barred from engaging in financial transactions using knowledge obtained from their official duties under a federal law called the STOCK Act. Insider trading is usually prosecuted as a felony offense.
Senator Perdue pushed to overturn a Consumer Financial Protection Bureau (CFPB) measure requiring banks that issue prepaid debit cards to be more transparent about fees. The measure also extends fraud protection to prepaid debit card account holders. CFPB did not overturn this rule but, instead, rolled back a significant portion of it.
According to Senator Perdue, CFPB should have scrapped this rule which he considered to be too broad. Perdue believed the rule would cripple the electronic marketplace. CFPB spokesperson, John Czwartacki, told Current Affairs Times, “As part of its rulemaking process, the Bureau considers all comments on a Notice of Proposed Rulemaking (NPRM) in accordance with the Administrative Procedure Act. The prepaid rule was effective April 1, 2019. The Bureau is currently not engaged in any rulemaking related to the prepaid rule.”
In 2019, within two weeks of this rollback, Perdue acquired multiple stocks in a credit card processing company, First Data. This company allegedly benefited directly from this rollback. In 2018, First Data reported processing $20 billion in prepaid payments. At that time, the prepaid card industry was processing nearly $200 billion in transactions annually.
DBP Enterprises LLC, an investment firm owned by Sen. Perdue and his wife, Bonnie, traded substantial First Data stock. Since assuming office as a senator in 2015, Perdue has traded stocks in over 400 companies. He reported more transactions in First Data than in any other company.
In a press statement, Sen. Perdue’s office mentioned that “Outside independent advisers made these specific trades and could not be directed or influenced by him.” Perdue’s office has denied allegations of improper conduct and has failed to justify any of his actions.
Sen. Perdue serves as a member of the Senate’s Banking Committee but has not developed a mechanism to ensure that he is not involved in financial decisions that could benefit him personally.
DBP’s First Data holdings come from a managed fund, which are also available to other public investors. However, Sen. Perdue’s office declined to name this fund and he has not disclosed mutual funds in his financial disclosures.
James D. Cox, a law professor at Duke University, stated that Sen. Perdue traded large amounts of stocks and that raises questions about what he did know.
Sen. Perdue now stands the risk of being scrutinized by the SEC which has declined to comment on this matter.
Was there any conflict of interest, corruption, and insider trading by one of the nation’s most powerful senators?
Image Credit: distel.com
Sources:
- Email to Current Affairs Times: CFPB Spokesperson, John Czwartacki.
“Sen. David Perdue Says His Perfectly Timed Stock Trades Are Completely Innocent”
Afia is a lawyer, journalist, an avid traveler, an avid reader, a foodie, and an amateur singer. She enjoys instrumental music with her glass of wine ?
