U.S. Senator Rand Paul (R-KY) listens to Dr. Anthony Fauci, director of the National Institute for Allergies and Infectious Diseases, during a Senate Health, Education, Labor and Pension Committee hearing on the ongoing federal response to COVID. to discuss -19, at the U.S. Capitol in Washington, DC, the United States, May 11, 2021.
Greg Nash | Reuters
WASHINGTON – Republican Senator Rand Paul and his wife hadn’t bought or sold any shares in any individual company in at least 10 years when Kelley Paul bought shares in pharmaceutical company Gilead Sciences in early 2020.
The purchase came at the start of the United States’ first wave of the novel coronavirus – and one day after the first US clinical trial for Gilead’s remdesivir for the treatment of Covid-19 began, according to records verified by CNBC.
That purchase and timing made headlines on Wednesday when the Kentucky Senator first disclosed it in a mandatory Senate filing – more than 16 months after the legal reporting deadline.
Rand Paul was one of the leading opponents of Covid mask mandates and other preventive measures and urged people to “oppose” them. YouTube suspended its official account on Tuesday for claims that masks did not prevent infection. Paul called the suspension a “badge of honor”.
The purchase of Gilead shares worth up to $ 15,000 came three weeks before the World Health Organization declared Covid a pandemic. On February 26, 2020, the day Kelley Paul bought the shares, there were only 14 confirmed cases of Covid in the US.
The STOCK Act of 2012 requires members of Congress to disclose purchases and sales of individual stocks, bonds, and commodity futures contracts within 45 days of the transaction.
Other assets – such as mutual funds, EIFs, and T-bills – are exempt from the 45-day requirement and only need to be disclosed once a year. The different reporting schemes prioritize the disclosure of transactions that could be used to benefit from non-public information.
As of 2012, Paul has disclosed 187 transactions in mutual funds, EIFs, trusts and government bonds in his annual reports. But he only announced one transaction in a single share: Gilead.
Paul’s office said he had timely completed a Gilead purchase disclosure form in 2020, but it was not submitted to the Senate Archives due to an oversight.
It’s not uncommon for a U.S. Senator like Paul or his spouse to buy shares in a public company like Gilead. But for Rand and Kelley Paul, Gilead is the first and only single stock that lawmakers have reported that he or his wife bought or sold during his 10-year tenure in the Senate.
Paul is a member of the Senate Health Committee who received a private briefing on the coronavirus threat from Trump administration officials in January 2020. A spokesman for Paul said the senator did not attend any briefings from the Covid committee.
A prominent Washington ethics attorney who refused to be named because his clients are both Republican and Democratic elected officials told CNBC, “If they are [Securities and Exchange Commission] If you conducted an inside trading investigation of this transaction, if the subject had not previously bought individual shares and recently had access to market-moving information, they would see the sudden purchase of individual stocks as a big red flag. “
Last year, federal prosecutors investigated stock sales in the run-up to a coronavirus-induced market slump by Sen. Richard Burr, RN.C., Sen. Jim Inhofe, R-Okla., Then a senator. Kelly Loeffler, R-Ga., And Sen. Dianne Feinstein, D-Calif.
These investigations ended without charge – but the investigations and details of the controversial deals became widespread at the time. Löffler lost a runoff election in January.
By not disclosing the purchase, Paul avoided the subject of an investigation such as that directed against his fellow senators last year.
Paul’s disclosure on Wednesday was first reported by the Washington Post. But the fact that Gilead shares were the couple’s only share purchase in the past decade has not yet been reported.
A spokeswoman for Paul said the senator and his wife had “lost money” on Gilead stock.
While it is true that Gilead’s price is now lower than when Kelley Paul bought the shares, she has not yet sold Gilead stock, which means she has not made any loss or gain from it.
CNBC asked Paul’s spokeswoman Kelsey Cooper if the Senator or his wife had bought or sold stocks in the year since the Gilead purchase. She did not answer.
Read more about CNBC’s policy coverage:
Gilead’s stock has fluctuated since Kelley Paul bought shares at $ 74.70, rose to $ 83.99, and fell to $ 56.56.
Gilead shares were trading at $ 70.65 late Thursday.
Exactly how many shares Kelley Paul owns is unclear. Senators are required to report the value of transactions by themselves or their spouses only within a range of dollar values. In that case, Kelley Paul bought shares valued at $ 1,001 to $ 15,000, the Senator Paul disclosure said.
Last month, Senator Tommy Tuberville, R-Ala., Announced stock and option deals totaling between $ 894,000 and $ 3.5 million from January through May.
Like Paul, Tuberville made its disclosure after the deadline set in the STOCK Act.
Tuberville’s deals on Jan. 25 included selling stock put options for Alibaba Group Holding Limited, the giant Chinese e-commerce company. Tuberville is a leading critic of China.
A Tuberville spokeswoman told CNBC last month that the senator did not even know about the individual stock and option deals and therefore did not know they would have to be disclosed by the STOCK Act deadline.
She said Tuberville has financial advisors to handle its stock trading. She wouldn’t identify these managers when asked who they were.
Correction: This article has been updated to reflect the correct spelling of Remdesivir.