The top Republican on the House Financial Services Committee is under investigation for insider trading as stocks plummet, foreclosures rise, and thousands lose their jobs.
The Congressman, Spencer Bachus, struck paydirt on a stock option last year after betting that a Chinese advertising company would jump in value.
In a single transaction on Dec. 10, Bachus of Alabama made up to $15,000 off an investment he had held for just two weeks, according to his congressional financial disclosure statement. He sold on the same day that the company, Focus Media Holding Ltd., got a market bounce off its announcement that it would acquire a competitor
The trade was among dozens made in 2007 by the powerful congressman, whose public statements alone can influence markets. Most of his trades were short-term options in which Bachus bet that a stock price would rise or fall and made a quick profit or loss accordingly. Sometimes, he made several trades in the same week, supplementing his $165,200 annual congressional salary with up to $160,000 for the year.
Bachus' suspicious rapid-fire trades are highly unusual for a leading member of Congress, particularly one with such a key market role and access to information not available to the general public.
http://www.bluetidalwave.com/2008/09/congressman-bachus-busted-for-insider.html
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