Trump's investments in Netflix and Warner Bros has everyone pointing out the same issue
Before he became the President of the United States, Donald Trump had been an entrepreneur for decades, with many of his ventures going bankrupt. But in the first year of his second term, Trump's family members have enjoyed hefty returns on investments, often thanks to his policies. The recent purchases of municipal and corporate bonds by U.S. President Donald Trump between mid-November and late December have sparked concerns of conflict of interest yet again. Disclosures show that in the transaction amounting to $100 million, the president bought $2 million in Netflix and Warner Bros Discovery, days after the announcement of a mega $82.7 billion deal for the merger of the two companies. While the White House has denied Trump's direct influence in the purchase, experts have flagged the issue as the president had previously stated that he would be personally "involved" in the deal between the media giants.
According to a financial disclosure from the White House, which is required by the Office of Government Ethics, a total of 191 financial transactions were made by the president, including two sales. According to Reuters, the list included two purchases of Netflix bonds and two purchases of Discovery Communications bonds, individually valued at between $250,001 and $500,000. What's concerning is the timing of the two transactions and Trump's past comments. Records show Trump bought the bonds between 12 December and 16 December, a little more than a week after Netflix agreed to buy WDB in a deal.
The deal is currently subject to regulatory clearance, and Trump has directly inserted himself into the matter. “They have a very big market share. When they have Warner Bros, that share goes up a lot. So, I don’t know. That’s going to be for some economists to tell, and also – and I’ll be involved in that decision too. But they have a very big market share," Trump told reporters on 7 December, a couple of days before the deal was announced and five days before he purchased Netflix and WBD bonds, as per CNN.
“This sets up the potential for a conflict of interest due to his involvement in regulatory oversight of the deal. The president should be making decisions prioritizing the interests of the public solely," the senior director of leadership ethics at the Markkula Center for Applied Ethics at Santa Clara University, Ann Skeet, told CNN. Richard Painter, former chief ethics lawyer under President George W. Bush and a University of Minnesota Law professor, told CNN that, “This is just one more investment that might very well conflict with his official duties, but by no means is it the most serious.” He explained that it is unprecedented, as every other president has actively avoided conflict of interest even though "the conflict of interest statute doesn’t apply to the president."
A White House official told CNN that Trump's stock and bond portfolio is independently managed by third-party financial institutions, and the president doesn't directly take part in the transactions. “All holdings are maintained in discretionary accounts and invested through computer-based model portfolios that automatically replicate recognized indexes, such as the Schwab 1000,” the White House said. The official added that neither the president nor any member of his family has "any ability" to "direct, influence, or provide any input" regarding how or when the investments are bought or sold. "All investment decisions are made entirely by independent managers," the statement added.
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