After his wife’s ExxonMobil sale led to STOCK Act violation, Rep. Peter Welch says he and his wife will no longer trade individual stocks

After his wife’s ExxonMobil sale led to STOCK Act violation, Rep. Peter Welch says he and his wife will no longer trade individual stocks

Rep. Peter Welch at a House Oversight Committee hearing on September 30, 2020.

Rep. Peter Welch says he and his wife will no longer hold individual stocks, reiterating a pledge he made in 2020.
The Vermont Democrat disclosed his wife’s sale of ExxonMobil stock one week late, violating the STOCK Act.
A conservative watchdog group is filing a complaint against Welch, who’s now running for Senate.

Rep. Peter Welch says he’s giving up individual stock-trading after an Insider investigation revealed that the Vermont Democrat was one week late in disclosing his wife’s purchase of $6,238 worth of shares in ExxonMobil in September.

“Rep. Welch has decided to no longer own individual stocks,” Welch communications director Arianna Jones told Insider. The 8th-term congressman made a similar pledge in April 2020, but this time it’s actually backed up by a new filing indicating that he’s sold off all of his individual stock.

And asked for clarification, Welch’s Chief of Staff Patrick Satalin told Insider that the pledge now applies to his wife, Margaret Cheney.

Welch’s failure to disclose his wife’s stock purchase in a timely manner constituted a violation of the disclosure provisions of the Stop Trading on Congressional Knowledge (STOCK) Act of 2012, an anti-conflict-of-interest law that Welch cosponsored himself.

Insider recently published “Conflicted Congress,” a 5-month-long investigation that found 52 members of congress — including Welch — and 182 senior congressional staffers in violation of the the federal insider trading prevention law. 

Insider also uncovered a number of conflicts of interest, including more than a dozen environmentally-minded Democrats who invest in fossil fuel companies or other corporations with concerning environmental track records.

Asked recently whether members of Congress and their spouses should be banned from trading stocks while serving, House Speaker Nancy Pelosi rejected the idea. “‘We are a free-market economy. They should be able to participate in that,” she said.

Welch, for his part, earned a “Borderline” rating — which generally indicates having a few STOCK Act violations either by members or their staffers — as part of Insider’s index of each member’s compliance with transparency rules.

Meanwhile, the conservative watchdog Foundation for Accountability and Civic Trust (FACT) filed a complaint against Welch last week with the Office of Congressional Ethics, calling for the body to “fully investigate this violation and apply the requisite penalties.”

Welch’s office did not comment on the complaint.

After Sen. Pat Leahy announced his retirement, Welch launched a Senate campaign, immediately earning the endorsement of progressive titan Sen. Bernie Sanders.

‘The clearest way to avoid even the appearance of a conflict’

Welch speaks at a climate rally on July 20, 2021 in Washington, DC.

Welch’s spokeswoman told Insider in November that the congressman’s wife, Margaret Cheney, sold her 113 shares of ExxonMobil stock on September 17 after inheriting the asset through her mother’s estate. 

He then learned of that trade — which his office says was made by his wife’s financial advisor — just three days before he grilled the the oil company’s CEO Darren Woods during a House Committee on Oversight and Reform hearing. Welch said ExxonMobil had withheld data and information about climate change.

“The issue here is credibility,” said Welch, an outspoken environmentalist, before engaging in a pointed exchange with Woods at the hearing.

While oil companies didn’t initially know about climate change, “they were the first to learn about it, and learning about it, concealed and denied it,” said Welch, who for years has publicly criticized ExxonMobil’s corporate responsibility and commitment to addressing the climate crisis.

Twelve days later, Welch disclosed the sale.

“This transaction had no impact on his line of questioning towards ExxonMobil’s chief executive officer about the company’s negligence and failure to disclose internal documents warning of the dangers of climate change,” his spokeswoman, Jones, said at the time.

The conservative group, however, slammed Welch for violating the act and questioned the ExxonMobil CEO only days after his wife sold its stock.

“What makes this case egregious, beyond the violation itself, is that his office acknowledged that he knew of the transaction prior to the reporting deadline and not only missed it, but grilled the ExxonMobil CEO about transparency and credibility just days later,” said Kendra Arnold, the executive director of FACT.

And on December 17, Welch filed a Periodic Transaction Report revealing that he apparently dumped all of his individual stocks in late November.

Jones told Insider that the filing “reflects” the congressman’s decision to forgo individual stocks, and she touted Welch’s record as “long-standing supporter of ethics reform and transparency in government” and a supporter of the Ban Conflicted Trading Act. That bill, introduced in March but yet to receive a hearing, would prohibit members of Congress from buying and selling individual stocks.

But Welch previously had pledged to stop trading individual stocks in 2020, after nonprofit news organization VTDigger found that he had profited from his financial manager’s investment in a COVID-19 testing firm.

“I have made a decision that the clearest way to avoid even the appearance of a conflict is to simply stop making purchases” of individual stocks “directly and indirectly through my adviser,” he told VTDigger in April 2020. He also told WCAX that he was instructing his financial advisor to only invest in mutual or exchange-traded funds.

But that prior pledge was undermined by a disclosure filed by the congressman in August, which revealed that he still owned several individual stocks at that time, including General Electric, IBM, PayPal, Unilever, and others.

Welch’s office did not respond to detailed questions from Insider about what sort of financial investments he might make in the future, what he thought of Pelosi’s remarks on stock-trading, or why he failed to live up to his pledge until now.

Read the original article on Business Insider

Politics, Peter Welch, Vermont, 2022 elections, Stock Act, Conflicted Congress, Exxon Mobil stock, Exxon Mobil

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