Congressman Krishnamoorthi Press Release

WASHINGTON, DC – On Saturday, Congressman Raja Krishnamoorthi sent a letter to Jay Clayton, Chairman of the Securities and Exchange Commission, to request that an investigation be opened into Senator David Perdue’s potential engagement in insider trading. This follows a November 23rd letter that Congressman Krishnamoorthi sent to Chairman Clayton regarding Senator Perdue’s purchase of stock in a naval supply firm that he oversees in his official capacity as Chairman of the Senate Armed Services Subcommittee on Seapower.

Congressman Krishnamoorthi cited a recent analysis conducted by professors at the Stern School of Business at New York University and the Desautels Faculty of Management at McGill University as another reason to open an investigation into Senator Perdue’s stock trading. The analysis found the following:

• 10 stocks in Senator Perdue’s portfolio – related to areas in which he was in a unique position to acquire nonpublic information – generated an effective annual return of 14.05% between 2015 and April 2020, which was 5.13% above the effective annual return earned by the S&P 500 total return index
• At the same time that Senator Perdue achieved these substantial returns in those 10 stocks, his overall portfolio trailed the performance of the S&P 500 given the fact that a 2015 investment would not have made any money by April 2020 in Senator Perdue’s overall portfolio but would have grown by 50% in the aggregate stock market

“From this evidence, it is fair to question why Senator Perdue excels in choosing stocks only in areas in which he happens to have privileged information,” Congressman Krishnamoorthi said. “If Senator Perdue made stock decisions based on privileged information acquired through his Congressional role, he would be in violation of the STOCK Act which bans the use of information derived from Members’ public offices for personal gain and designates it as a federal offense subject to severe penalties.”

This new analysis demonstrating Senator Perdue’s performance with stocks related to his Senate committee work or his private industry relationships is the latest evidence of his pattern of potentially illegal behavior. As discussed in Congressman Krishnamoorthi’s last letter, Senator Perdue purchased stock in BWX Technologies, touted increased funding for the building of an additional Virginia-class submarine for the 2019 National Defense Authorization Act (NDAA) which was built with BWX Technologies parts, and then Senator Perdue earned tens of thousands of dollars by selling his shares in BWX Technologies.

“Senator Perdue’s conduct in the stock market demonstrates the issues with the current system and highlights the need for stricter regulations such as my Ban Conflicted Trading Act, which would bar members from trading individual stocks,” Congressman Krishnamoorthi said.

Congressman Krishnamoorthi requested that the U.S. Securities and Exchange Commission immediately open an investigation into Senator David Perdue’s stock trading activities.

A copy of the letter is available here.