Revealed: David Perdue bought bank stocks after meeting financial officials


David Perdue, the Georgia Republican facing a Senate runoff election on Tuesday, has twice bought a significant number of shares in a US bank shortly after meeting with financial policy makers, raising more questions about his prolific stock trading while in office.

In one case, in May 2015, Perdue bought between $15,000 and $50,000 worth of shares in Regions Financial Corporation two days after a 10-minute phone call with then treasury secretary Jack Lew.

Perdue bought additional shares in the bank two years later, on 18 May 2017, two days after a half-hour meeting with then Federal Reserve chair Janet Yellen.

It is not clear in either case if Perdue discussed relevant financial regulation or other market-sensitive issues with Lew or Yellen or whether the discussions influenced his decision to buy the stock.

At the time of the call with Lew, members of the Senate banking committee, on which Perdue sits, were engaged in close talks over a potential trade deal.

But the purchase of more Regions stock in the wake of Perdue’s meeting with Yellen – who will be nominated to serve as treasury secretary by Joe Biden once the president-elect takes office – is possibly significant, because it came about two months before Yellen publicly discussed her support for raising the $50bn asset threshold for systemically important institutions, a change that meant Regions bank could see an easing of important financial regulations.

As Yellen’s views on the topic publicly evolved in her role as chair of the Fed, so did Perdue’s buildup of stock in Regions. Perdue separately sought to advance deregulatory legislation that would be favorable for banks like Regions, which Regions and more than a dozen other banks publicly endorsed.

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Public records show that Perdue sold his full stake in Regions on 11 October 2019 and on 23 October 2019, suggesting that Perdue may have made a 21% return on his earlier investment. He then bought more shares of the stock in November 2019 and January 2020.

John Burke, Perdue’s communications director, has said that Perdue does not handle day-to-day decisions about his portfolio, which Perdue claimed is managed by outside financial advisers.

It is not uncommon for policy makers like Yellen to have meetings with senators. On the day of her meeting with Perdue in 2017, Yellen also met with Lord Mervyn King, the former governor of the Bank of England, had lunch with Treasury secretary Steve Mnuchin, and then met with another senator, Ohio Democrat Sherrod Brown.

Former government insiders say policy makers try to be cautious in such meetings, and try to avoid sharing information that could move markets. At the same time, it can be difficult to avoid the sharing of potentially valuable information if senators and policy makers are discussing any issue in depth, and a senator might be able to gauge an evolving policy position that could be market-sensitive.

The new revelations come as Perdue’s frequent stock trading while in office has come under increased scrutiny in the press ahead of his runoff Senate election on Tuesday. If Democrats win two runoff elections, it will transfer control of the Senate from Republicans to Democrats.

Previous media reports have focused on how Perdue has faced federal scrutiny for his frequent stock trading while in office, and whether his position as a senator with access to market-sensitive information, especially during the pandemic, may have influenced some trades. The New York Times, citing multiple anonymous sources, said Perdue’s sale of $1m in stock in a financial company called Cardlytics, where he served on the board, drew the attention of investigators at the Department of Justice last spring, who were undertaking “a broad review of the senator’s prolific trading around the outset of the coronavirus pandemic for possible evidence of insider trading”.

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The investigators ultimately concluded that a personal message that had been sent to Perdue from the company’s chief executive, alluding to “upcoming changes”, was not “nonpublic information”, and declined to pursue charges. Perdue sold his stock two days after he received the personal message from the CEO. About six weeks later, the chief executive resigned and the company revealed that results were below expectations, causing the stock to tumble.

The New York Times separately reported that, as a member of the Senate’s cybersecurity committee, Perdue and others sought out the protection of the National Guard against data breaches. The newspaper said that beginning in 2016, Perdue bought and sold shares in a cybersecurity firm called FireEye on 61 occasions. Nearly half of those trades, the New York Times reported, occurred while Perdue sat on the cybersecurity committee, which could have given him access to sensitive information.

Perdue’s senate campaign did not respond to the Guardian’s request for comment. He has formerly denied having any conflict of interest.

But Perdue’s challenger in this week’s senator runoff, Democrat Jon Ossoff, has repeatedly raised the issue, and accused Perdue of using his office to enrich himself.

Perdue’s spokesman has called the criticism “baseless” and he has emphasized being “totally exonerated” by federal investigators.



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