November 13, 2015 Government, In The News, News

Watchdog Complaint Accuses Corker of Insider Trading, False Statements

By: Michael Collins, The Commercial Appeal, 11/11/15

A government watchdog group has filed a complaint against U.S. Sen. Bob Corker that accuses the Chattanooga Republican of insider trading and making false statements on his personal financial disclosure forms in violation of federal law and Senate rules.

The complaint, filed Tuesday by the Campaign for Accountability, contends that between 2008 and 2015, Corker, his wife and daughters made 70 trades of stock in the Chattanooga real estate investment firm CBL & Associates Properties — more than triple the number of transactions he made of any other stock.

Some of the trades closely preceded company announcements that led to changes in the stock’s price and seemingly resulted in the senator making millions of dollars, says the complaint filed with the Securities and Exchange Commission and the Senate Ethics Committee.

“Senator Corker’s trades followed a consistent pattern — he bought low and sold high,” said the Campaign for Accountability’s executive director, Anne Weismann. “It beggars belief to suggest these trades — netting the senator and his family millions — were mere coincidences.”

Corker’s office said the charges are false and politically motivated.

“These baseless accusations from a political special interest group are categorically false and nothing more than a smear campaign,” the senator’s spokeswoman, Tara DiJulio, said in a written statement.

“The senator always has disclosed to the public that he invests in CBL since he first held stock in the company back in 2007,” DiJulio said. “The accounting firm that worked on his financial disclosure reports properly listed the sale and gain or loss of transactions, but some did not list the day they were purchased, so after completing a full review, we are correcting this technical oversight.”

The complaint follows a published report last week that accused Corker of failing to properly disclose millions of dollars in stock purchases in the Chattanooga real-estate company, including several that resulted in his most profitable investments.

In one previously unknown purchase, Corker bought between $1 million and $5 million in shares of CBL in late 2011 and sold them five months later for a 42 percent gain, The Wall Street Journal reported.

Two purchases in 2009 in accounts in the name of his daughters likely netted more than $1 million, the newspaper said.

The Journal said Corker reported a dozen CBL stock purchases on his Senate financial disclosure reports only recently and after the newspaper raised questions about apparent discrepancies in those reports. Congressional ethics rules require lawmakers to make public their financial investments in broad ranges each year.

In its complaint, the Campaign for Accountability charged that many of Corker’s profitable trades were made in advance of his broker, UBS Securities, issuing reports impacting CBL’s trading price. If Corker’s trades were based on material, nonpublic information he received from anyone with a fiduciary duty to CBL or UBS in return for any benefit, the senator may have engaged in insider trading, the group said.

The complaint also charged that Corker, a member of the Senate Banking Committee, has advanced legislation that would financially benefit CBL and UBS.

The Campaign for Accountability, based in Washington, formed just last May and describes itself as a nonpartisan, nonprofit watchdog organization. According to its website, its leaders include several people with ties to Democrats. Some of its leaders previously worked for Citizens for Responsibility and Ethics in Washington, a group that has filed complaints against several Republican lawmakers over the years.

In October, the new group filed a complaint against 11 Congress members — nine Republicans, two Democrats — claiming they accepted campaign contributions from the payday lending industry shortly before or after they took a series of steps supporting the industry. Those targeted in that complaint included U.S. Rep. Stephen Fincher, a Crockett County, Tennessee, Republican.