House Speaker Nancy Pelosi is under fire for a stock purchase in Tesla that came only weeks before President Joe Biden proclaimed his intention of making the federal vehicle fleet totally electric.
“It’s corrupt and unacceptable for members of Congress, particularly the speaker, to trade stocks in companies affected by their votes in Congress,” said John Pudner, the executive director of TakeBack.org, according to the The Washington Times.
Last month, Paul Pelosi bought 25 call options costing between $500,000 and $1 million, according to a financial disclosure dated Jan. 22. The options granted the right to buy up to 2,500 Tesla shares at a price of $500 apiece. the options expire on March 18, 2022.
Tesla shares were at $640.34 when the call options were purchased.
The Pelosi deal had a value of $1.12 million as of Monday, according to Benzinga, an investor site.
Biden’s campaign website had proclaimed his intention to buy “clean vehicles for federal, state, tribal, postal, and local fleets,” but it was not until this week that he officially proclaimed his intention to replace the full 645,000-vehicle federal fleet with electric vehicles.
“The problem is there are a lot of things that any congressperson could do behind the scenes to positively influence Tesla [shares], such as stalling legislation and putting forth legislation,” said Aaron Hill, professor of management at the University of Florida, according to Fox Business.
“A lot of this is just documented in committee meetings, so it really raises the specter of double-dealing or certainly conflict of interest,” Hill said.
The Tesla purchase was the first for the Pelosis going back to 2013, according to Fox Business.
A Pelosi spokesman said the speaker was not involved in the purchases.
“The disclosure forms clearly indicate these investments were made by Mr. Paul Pelosi not the Speaker,” a spokesman for Pelosi’s office told Fox Business, noting the letters “SP” on the disclosure forms mean a spouse made the purchase.
However, under the federal STOCK Act, spouses are not allowed to act on information that is not shared with the public, as are the lawmakers themselves.
“Elected leaders from all political parties should live up to a standard of ethics that ordinary Americans see as vital to the country,” Pudner said.
News of Pelosi’s deal did not go over well on Twitter:
Right before the Biden Admin announces the federal fleet of cars to electric @SpeakerPelosi put another $1 million into Tesla. Nancy Pelosi has plowed up to $1 million into bullish bets on Tesla stock https://t.co/h3MFbaETAo via @YahooNews
— Sean Spicer (@seanspicer) January 26, 2021
— Romain – The Swarm Blog (@theswarmblog) January 24, 2021
— Richard W. Painter (@RWPUSA) January 27, 2021
Some commentators said reforms are needed.
“We know that mere disclosure of securities trades is not enough. The need for a stricter rule is abundantly clear,” Donna M. Nagy, a law professor at Indiana University said.
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