Warren, Blumenthal, Cummings Call on SEC to Investigate Potential Insider Trading by Commerce Secretary Ross
Washington, DC - In a letter sent today to Securities and Exchange Commission (SEC) Chairman Jay Clayton, Senator Elizabeth Warren (D-Mass.), Senator Richard Blumenthal (D-Conn.), and Representative Elijah E. Cummings (D-Md.) called on the SEC to investigate whether Secretary of Commerce Wilbur Ross violated insider trading or other securities laws as a result of his investment activities related to Navigator Holdings Ltd - a company with ties to associates of Russian President Vladimir Putin. It was revealed last week that Ross shorted stock in Navigator Holdings shortly after he likely learned that news reports would be published about his investments in the Kremlin-linked company.
"These trades raise questions about several different insider trading laws," wrote the Members of Congress, noting restrictions dating back to the Insider Trading Sanctions Act of 1984 and the STOCK Act of 2012 that ban individuals from using material, nonpublic information to benefit themselves through securities trading, punishable both by civil and criminal penalties.
They continued, "We have no way of knowing precisely why Mr. Ross shorted Navigator Holdings' stock immediately after he likely learned about - but did not disclose -a pending news story that caused the company's stock price to drop significantly. But this chain of events raises questions about whether the Secretary potentially made investment decisions based on material, non-public information, and whether that material, non-public information was potentially derived from his position as Commerce Secretary."
Warren, Blumenthal, and Cummings asked Chairman Clayton to open an investigation into Secretary Ross's trades related to Navigator Holdings and to brief the Members on it. The full text of the congressional letter is available here.