Several U.S. ambassadors actively abandoned their stocks as President Donald Trump tried to minimize the coronavirus outbreak in its early stages.
The ambassadors of Uruguay, France, Morocco and Italy sold shares in transactions that could have earned them millions of dollars, according to financial disclosure documents reviewed by CNBC. Much of its sales were in January and continued throughout February, according to records. His transactions are aligned with a timeline of federal and congressional announcements as the virus began to spread worldwide earlier this year.
Some of the ambassador stock transactions were for companies involved in the research or development of products that are linked to the treatment of patients who have contracted the coronavirus, such as biopharmaceutical companies.
Trump began publicly downplaying the severity of the pandemic earlier this year, including in late January during the World Economic Forum in Davos, Switzerland. At that event, he told CNBC that the administration had him “under control. He will be fine.”
Italy and France have a death toll from coronavirus close to or greater than 30,000. Morocco and Uruguay have combined for more than 200 deaths. More than 10.7 million people have been infected worldwide, according to a count by Johns Hopkins University.
As the White House rushed to respond to the spread of the virus, Ambassadors Lewis Eisenberg, Jamie McCourt, David Fischer and Kenneth George were seeing huge profits from the stock transactions., Their presentations show.
A State Department spokesman said the ambassadors were briefed in late February at the Global Conference of Heads of Mission about the potential impacts that the coronavirus could have on their operations, but that they were never part of any other meeting this year. The spokesperson also said that sales and purchases of shares were often based on the guidance of financial advisers.
“The US ambassadors were briefed on the possible impacts of the Covid pandemic on State Department operations at the Global Conference of Heads of Mission from February 25 to 26, 2020,” the spokesman said Thursday. “Otherwise, the ambassadors received no information about Covid from any United States government official. These financial decisions were among a wide range of buying and selling to adjust portfolios, often based on the advice of advisers financial “.
Democrats are already attacking the actions of Trump diplomats, including the Democratic super bridge American PAC, which initially marked some of the sales and purchases of shares to CNBC.
“Any official who dropped millions of shares while the administration downplayed the threat has no business in a position of public trust and his actions warrant a thorough investigation to prevent further abuse of power,” said Max Steele, a spokesman for the group. a declaration.
His sales came as many investors were hit in the stock market. The Dow Jones Industrial Average began accumulating in late February and bottomed out next month, reaching its lowest point since Trump took office.
Many of these ambassadors have been donors to the Republican Party for a long time, including those who donated to the 2016 Trump campaign for President and his inaugural committee. The discovery of their operations comes after Sens. Richard Burr and Kelly Loeffler were under scrutiny for selling their securities at the start of the pandemic. Burr is being investigated for those sales by the FBI.
Another member of the Trump administration, former chief of staff Mick Mulvaney, also ditched parts of his stock portfolio as the president tried to distance himself from the pandemic, The Daily Beast recently reported.
Fischer, who gave $ 275,000 to Trump’s inaugural committee and is currently the United States’ ambassador to Morocco, sold from nearly $ 380,000 to more than $ 2 million in shares between January and February, according to his financial disclosure report. The Government Ethics Office asks government officials to give a range of how much federal employees earn from buying or selling assets.
One of Fischer’s big sales, according to his statement, occurred on February 5, the same day that Democratic Sen. Chris Murphy said he left an administration briefing as if White House officials “did not know. are taking it seriously enough. ”
That day, Fischer’s presentation shows that he sold between $ 2,000 and $ 30,000 in shares in at least two companies that are involved in the development of coronavirus treatments, such as Biohaven Pharmaceuticals. The pharmaceutical company announced on its website in April that it plans to “study intranasal vazegepant, a structurally unique, third-generation, high-affinity, small-molecule, selective CGRP receptor antagonist in lung complications of COVID-19 disease.” .
Fischer also sold shares in BioTelemetry, a cardiac monitoring company that, according to its website, is promoting a coronavirus monitoring program. Shares of both companies fell dramatically over the course of a month since Fischer sold their shares. For Biohaven, the shares were priced at just over $ 53 on February 5, and a month later they would drop at least 8%. BioTelemetry was priced at around $ 53 that same day, and then its share price fell 20% a little more than a month later.
In January Fischer bought and sold shares in Apple, Amazon and Alphabet. In March, he sold between $ 15,000 and $ 50,000 in Uber stock.
George, the United States Ambassador to Uruguay, carried out a wave of stock purchases and sales in January and February. Of the notable transactions, George invested between $ 5,000 and $ 75,000 in RedHill Biopharma. In May, the company announced that it was approved by the Food and Drug Administration for a Covid-19 clinical study.
In March, George also bought and sold shares of Inovio Pharmaceuticals, a biotechnology company that recently started clinical trials for a possible coronavirus vaccine.
McCourt, the United States’ ambassador to France, sold her shares on January 17 in what is described in her financial statement as “AJ Capital Graduate Hotel Fund III”. She made between $ 1 million and $ 5 million on that divestment alone, and up to an additional $ 10 million on other stock sales that same day. The Centers for Disease Control and Prevention and other U.S. government agencies, at the time, announced that they were conducting health screenings for those traveling from Wuhan, China, where the outbreak is believed to have started.
That fund appears to be an investment vehicle through a portfolio of hotels and properties managed by Adventurous Journeys Capital Partners, also known as AJ Capital Partners. On its website, the real estate company promotes a hotel portfolio titled “Graduate Hotels,” which was established in 2014.
Through partnerships with universities, the firm began opening hotels around universities across the country. However, the pandemic forced many of the “graduate hotels” to temporarily close, and, according to its website, has just started reopening. Six of the 28 hotels listed reopened in June, while another 11 on the website are slated to begin opening in July.
The hotel industry in the first quarter of 2020 was affected by the pandemic. FactSet data shows that many of the leading hotel operators, from Marriott to Hilton, saw their first-quarter financial performance drop by as much as 64%.
During the 2016 election, McCourt gave almost $ 450,000 to Trump’s Victoria committee, a joint fundraising committee between the Trump campaign and the Republican National Committee. Since its confirmation in 2017, it has delivered a six-figure check to the same fundraising operation.
Eisenberg, the US ambassador to Italy, almost a week before the US State Department issued a travel warning to people considering a trip to that country, as he saw a wave of Covid-19 cases, between $ 200,000 and $ 500,000 in stock sales.
Eisenberg’s presentation describes the source of the funds, in part, as follows: “AMLP – ALPS ETF TR ALERIAN MLP NOT REQUESTED.” It appears to be a publicly traded fund, which often owns groups of stocks, commodities, or bonds and automatically transacts according to schedules. He gave the RNC $ 35,000 in 2015 before Trump was officially the Republican nominee.
It is unclear what actions are within that fund.
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