Insider trading charges have been filed against former Bakkt CEO Kelly Loeffler.
The accusations come from the newspaper The Daily Beast, according to which Loeffler, now a member of the US Senate, sold off securities before the collapse of the financial markets, in the days and weeks following a private meeting of all senators on the coronavirus emergency.
It all began on January 24th, 2020, when the Senate Health Committee, of which Loeffler is a member, hosted a private briefing for officials including the director of the CDC and the head of the National Institute for Allergies and Infectious Diseases.
The theme was the spread of the Covid19 coronavirus and, after the briefing ended, it would appear that Senator Kelly Loeffler began selling shares owned by her husband, Jeffrey Sprecher, founder and CEO of the Intercontinental Exchange (ICE), the company that owns the New York Stock Exchange and Bakkt.
The first sale was of shares in Resideo Technologies and since then the price of her shares has fallen by more than 50%. This was followed by an additional 26 sales, which ended in mid-February when the US stock exchange indices first started to decline, and then to collapse.
It should be noted that, in the same period of time, Loeffler and Sprecher also made two purchases of shares, one of which is a company offering software for teleworking.
Loeffler defended herself by arguing that she does not make investment decisions, but that these are made by third-party advisors, without the involvement of her husband.
She then added:
“As confirmed in the periodic transaction report to Senate Ethics, I was informed of these purchases and sales on 02/16/2020 – three weeks after they were made”.
Therefore, Loeffler admits that those sales were made, not even denying the timing, but saying that she was not aware of the facts. However, she does not explain how the information she may have gathered during the private briefing on January 24th could have reached the ears of the consultants who would have decided to sell on her behalf.
The fact is that, if that had happened, it would have been illegal, given that by law members of Congress in the US are not allowed to share non-public information gathered through their official activities with anyone.
In addition, there would also be a second senator who would have sold shares after attending the briefing of January 24th. This is Richard Burr, Chairman of the Senate Intelligence Committee, who sold between $500,000 and $1.5 million worth of shares in February.