Any freshman in high school can tell you that insider trading with the stock market is illegal. Additionally, some of the more civic-minded high schoolers can tell you that even if members of congress do it, it is still illegal. So, that’s all well and good, but then why is it that Nancy Pelosi and her husband have gotten rich off of insider trading and nothing has happened to them?
New financial disclosure forms are showing that the speaker’s husband, Paul Pelosi, has purchased millions of dollars’ worth of stock from Roblox (RBLX) and Microsoft (MSFT) last month.
According to Fox Business: “Paul Pelosi has exercised several call options for both of these companies, paying $1.95 million to purchase 15,000 shares of Microsoft on March 19th at a strike price of $130. It was on that same day that Pelosi, who is also known as the owner and operator of a California venture capital investment and consulting firm, purchased 10,000 shares in a different transaction at a rate of $1.4 million. Paul Pelosi also has an important transaction on March 10 where he paid from $500,000 to $1 million to buy the 10,000 shares of Roblox Corporation, which is the same day that the online game platform went public.
Same after Mr. Pelosi made this purchase, the share price of Microsoft rose from $230 per share to $255 per share precisely because of the fact that the company had secured a government contract to the tune of $22 billion. The deal was announced on March 31, and it allowed Microsoft to become a supplier of augmented reality headsets to the U.S. Army.
However, Paul Pelosi cannot do this. According to the 2012 STOCK Act, members of Congress and their family are not allowed to profit from this type of insider information.
If Joe Sixpack had knowledge of this deal and they had made this trade, they would face some heavy fines and might even be thrown in jail. This average joe would also lose all of their profits. However, Nancy Pelosi and her family are not ordinary Americans, and so the rules don’t seem to apply to them.
What do you think? Your comments would be appreciated!