Over 2,600 officials at federal agencies invested in stocks of companies at the same time the firms were lobbying their departments for favorable policies, uncovered an investigation by the Wall Street Journal (WSJ).
WSJ looked at over 31,000 financial disclosure forms of over 12,000 political staff members, presidential appointees, and career employees—analyzing data of more than 315,000 trades in stocks, funds, and bonds made by the officials, their spouses, or their children between 2016 and 2021. Close to 40 percent of officials in the Treasury department had invested in stocks of firms that lobbied the agency.
Over 1,800 federal officials owned or traded in big tech firms like Meta, Apple, Amazon, and Alphabet at a time when the government was intensifying its scrutiny of such companies. Around 70 federal officials used risky trade techniques like options and short selling, with some individual trades going up to $25 million in value.
At the EPA, over 200 senior officials invested in firms lobbying their agency. On average, employees from the department as well as their family members owned between $400,000 and $1 million worth of shares in oil and gas firms collectively every year during the investigation period.
Officials from the Defense Department’s office of the secretary collectively owned between $1.2 million and $3.4 million on average in stock investments in defense and aerospace companies every year. Some of the investments were in Chinese firms at a time when Washington was considering blacklisting these firms.
Ethics, Legislation
Speaking to WSJ, Don Fox, an ethics lawyer and former general counsel at the U.S. agency that oversees conflict-of-interest rules, pointed out that several of the trades made by officials cited in the report “clearly violate the spirit behind the law, which is to maintain the public’s confidence in the integrity of the government.”In July this year, Pelosi came under scrutiny after her husband bought semiconductor stocks just before Congress planned to vote on the industry.