Georgia Congressman Tom Price is in hot water over a stock purchase that critics say made him quick money after he introduced legislation to benefit the company.
Price was grilled by democrats during his confirmation hearing. He’s been nominated by President Elect Donald Trump to serve as the Secretary of Health and Human Services.
“Everything we’ve done has been above board, ethical and legal,” Price told senators this week.
It’s been reported that Price made a profit of $50,000 to $100,000 after introducing a bill that helped a medical device company. He had purchsed company stock at a reduced price just a week prior to introducing the legislation.
“Because had he not been in the House he couldn’t have benefited that company in any way other than hope it would gain value one day,” said Political Science Professor Bruce Mallard.
Mallardequate’s the action to insider trading if it were you and me doing it. “If you purchase stock based on only information you have, you go to prison for it,” he said. “And that’s what happened to Martha Stewart. So, there’s a great concern there that he is ethically challenged ..”
Still, fellow Georgian Senator Johnny isakson isakson defended price’s integrity – saying allegations are patently wrong and that critics have put two correct things together to make an incorrect thing.
He’s apaprently referring to 1) the stock purchase and 2) the legislation.
Price said he often instructed his broker on stocks to buy but not in this particular case. In the case in question, Price told lawmaker that his broker had just picked the stock. Mallard says it’s an interesting scenario.
“Price claims he bought the stock through a broker blindly but it’s strange to believe that a broker would have bought a stock out of the thousands of options (available to choose from) that was the subject of legislation days later benefiting the company,” says Mallard. “This is an incredible coincidence and that’s what we’re asked to believe.”
Mallard says members of Congress weren’t even subject to insider trading rules until 2012, but says even with new rules, it’s not always likely that someone like Price would be censored. “It was a win-win for Price apparently. But it was a lose-lose for ethics,” he told us.
Mallard says it’s unclear if the majority of Georgians or Americans would be concerned although he believes they should be.
“I don’t think most people probably care, ” he said. “It may be a little intricate to follow and it wasn’t exactly like he robbed a bank or something although many pepole would say you can make far more money in the stock market with insider informatoin than you could robbing banks.”
“I just think our expectations have been lowered in terms of what we can live with as far as behavior from our public officials,” Mallard says.