Sen. Perdue Bought Navy Contractor Stock Right Before Taking Over Seapower Subcommittee, Then Sold Stocks For Profit

by | 5 months ago | Top Stories | 0 comments

The Daily Beast reports that Sen. David Perdue (R-GA) bought stock in a company that makes submarine parts right before he was put in charge of the Senate subcommittee with jurisdiction over the U.S. Navy.

Perdue then earned tens of thousands of dollars by selling off the stock “once he began work on a bill that ultimately directed additional Navy funding for one of the firm’s specialized products.”

Per the report:

In January 2019, Perdue was named as the chairman of the Senate Armed Services Subcommittee on Seapower. It was good home-state politics for Perdue: Georgia is home to one of the most important Naval facilities on the East Coast, the Kings Bay Naval Submarine Base. And his appointment was seen as a win for the submarine segment of the Navy, with trade publications calling it a “coup” for submariners.

But in the month before he took over the job, Perdue did something unusual: he acquired up to $190,000 worth of stock in BWX Technologies, a company he had never invested in before. The Virginia-based firm had lucrative contracts with the U.S. Navy to develop high-tech components for its fleet of nuclear submarines—and it was looking to expand that business when lawmakers took on the 2019 version of the sweeping annual legislation that sets funding benchmarks for the U.S. military, called the National Defense Authorization Act.

Perdue would play “a key role in shaping the NDAA as Seapower chairman, and later as one of the few lawmakers hand-picked by party leadership to hammer out the final version of the bill between the House and Senate,” The Daily Beast reported.

From February to July, as he was shaping the defense bill and working for that submarine funding, Perdue reported selling off all his shares of BWX—reaping a healthy profit in the process. The senator’s final financial disclosure form for the year 2019 reported earnings of $15,000 to $50,000 in his trading of BWX.

In response to The Daily Beasts’ inquiries, Perdue’s office insisted that the senator does not personally make decisions about his stock portfolio.

A Perdue spokesperson told the publication: “Senator Perdue doesn’t manage his trades, they are handled by outside financial advisors without his prior input or approval.”

“No amount of lies from liberal media outlets or Democratic political groups will change that fact,” the spokesperson added.

The Daily Beast noted that “Perdue is defending his seat in a runoff election set for January 5, which will help decide control of the Senate.”

Kedric Payne, who analyzes stock trades at the Campaign Legal Center, a nonpartisan money-in-politics advocacy group, said Perdue’s example is the very reason why many lawmakers avoid trading individual stocks.

“It is nearly impossible to make decisions affecting an industry and then receive a personal financial benefit without appearing to have a conflict of interest,” said Payne. “Even if officials rely on financial advisors to make trading decisions on their behalf, the perception of conflicts of interest remains because the public does not know if there are winks and nods prompting the trades.”

“The conflict of interest situation is heightened when the member of Congress sits on a particular committee that is so pervasively affecting the company whose stock is in question,” said Donna Nagy, a law professor at Indiana University who studies lawmaker stock trading.

“I think that the question raised here—and we don’t know the answer, is did personal stock holdings influence his legislative activity?” asked Nagy. “We’re left with a series of questions… we shouldn’t, as members of the public, be left to ask these questions about elected officials.”

Read the full report.

Image credit: Gage Skidmore / CC BY-SA 2.0 / Flickr

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