Coronavirus and insider trading: scheming, butter and Burr’s money …

Still unknown to the general public a few months ago, the American senator from North Carolina and member of the health committee, Richard Burr, is now the subject of controversy in the United States. He is accused, as well as three other senators, of having sold stock market shares, after having been informed of the real danger of the coronavirus by a scientific committee. A practice akin to insider trading, punishable in the United States since 2012.

On February 7, the Republican senator addressed his fellow citizens, aligning his remarks with those of his president Donald Trump who tended, at the time, to minimize the extent of the crisis. “Americans are well protected, government is better prepared than ever to deal with Covid-19”, he wrote in a forum hosted on the Fox News site.

However, less than a week later, on February 13, he was selling stocks between $ 628,000 and $ 1.7 million on the stock market. In total, Richard Burr has carried out no less than 33 different stock market transactions, mainly in the hotel sector. This small stock market game finally saved him a large amount of money, since a few days later, the financial markets, also victims of the spread of the Covid-19, collapsed, and the shares sold by the senator had lost a lot of value.

Confidential report and contradictory speech

In the United States, what is really problematic is the double game operated by the senator. While he appeared confident and satisfied in the media regarding the American management of the coronavirus in early February, he was much more alarmist at the same time with his relatives. “There is one thing I can tell you: the transmission of this virus is much more aggressive than anything we have seen in history”, he explained to a hundred people in a private club on February 27. This speech, which was to remain secret, was obtained by the American public radio NPR, and it has plunged the Republican senator into turmoil for a few days.

During the same evening, Richard Burr also indicated that the coronavirus could cause “major disruptions” in the American economy. “We are undoubtedly closer to the Spanish flu pandemic of 1918”he said to his audience.

Richard Blurr, who is a member of the committee in charge of health issues in the United States, would therefore have taken advantage of confidential information gleaned from meetings with scientists, to derive financial benefit and to prevent some of his knowledge, to the detriment of the whole population. A practice that looks very much like insider trading. These actions, highlighted by the information site ProRepublica on March 20, dismayed political figures, both Democrats and Republicans.

Possible sanctions

The senator from North Carolina is not the only one who took advantage of confidential information to avoid financial losses. The New York Times has indeed revealed that three other senators had also sold a large number of stock shares after attending certain meetings with scientists and epidemiologists about the coronavirus.

In 2012, Barack Obama had passed a law in the United States to strengthen the law of 1934 on insider trading, and try to limit more precisely this kind of practice, exposing the profiteers to financial sanctions. Richard Burr had already stood out at the time, since he had been one of the main senators to vigorously oppose the implementation of this law.

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