Richard Burr Accused of Insider Trading—How Much Money Did He Dump?
Senator Richard Burr has been accused of insider trading following evidence of communication before dumping stocks.
Oct. 29 2021, Published 11:10 a.m. ET
New details are emerging about Senator and Intelligence Chair Richard Burr (R-N.C.), who dumped a large portion of his stock portfolio ahead of the February 2020 market crash.
Given the timeline of events, experts are investigating Burr for insider trading in partnership with his brother-in-law and fellow governmental insider Gerald Fauth.
Richard Burr is accused of insider trading
In March 2020, reports surfaced of Burr selling millions in stocks the month prior. Burr's massive sell-off came just days after he reassured the public in an op-ed on the Fox News website. Burr wrote, "The United States today is better prepared than ever before to face emerging public health threats, like the coronavirus."
Shortly after Burr sold a large portion of his portfolio, the stock market tanked by nearly a third. Now, new information highlights just how calculated Burr's move might have been.
Richard Burr's brother-in-law comes into the picture
New reports tell us that Burr dumped his stocks and immediately called Fauth.
Fauth is the chairperson of the National Mediation Board. Former President Donald Trump appointed Fauth to the role in 2017. In the past, he was president of transportation economic consulting firm G.W. Fauth & Associates Inc.
Burr spoke with Fauth on the phone for 50 seconds. At the time, the SEC reports that Burr has non-public information. The STOCK Act of 2012 directly prohibits congressional stock trading based on material, non-public information.
One minute after Fauth and Burr got off the call, Fauth called his broker.
This phone call evidence is huge for the insider trading case against Burr. It's notoriously difficult to prove a congressperson enacted trades based on insider knowledge.
The SEC has had a subpoena against Burr for more than a year, but he managed to stall it until now.
How much money in stocks did Burr dump?
Burr sold $1.6 million in stocks on February 13, 2020. The sell-off occurred over the course of 33 separate transactions. Previously, reports said that Burr sold anywhere from $628,000–$1.72 million. The new SEC filing tells us that the numbers are near the high end of that estimate.
The COVID-19 pandemic-induced market crash occurred one week later on Feb. 20. At the time, the stock market fell about 30 percent. Burr was able to liquidate his assets and avoid the economic downfall that hurt so many people's lives.
Will Burr get charged with insider trading?
The information about Burr is especially dark considering that he made an effort to avoid panic in U.S. investors. If he intentionally eased his outlook for the COVID-19 pandemic, he could be charged with insider trading.
Recent evidence makes that outcome possible. Reporters obtained a Feb. 27 recording of Burr telling exclusive social club members that he had a dire outlook for the pandemic, which is a stark contrast of what he told people previously.
Burr co-authored the Pandemic and All-Hazards Preparedness Act and could have easily been exposed to briefing materials that informed his investment decisions.
