Rep. Gianforte responds to accusations about profiting from pandemic
Daily Inter Lake | April 19, 2020 1:00 AM
Montana Attorney General and Republican gubernatorial candidate Tim Fox recently accused U.S. Rep. Greg Gianforte, R-Montana, of “insider trading” and investing in companies that stand to profit off the COVID-19 pandemic.
In an email to supporters on April 10, Fox’s campaign also accused Gianforte of breaking his 2017 promise to Montanans that he would put his money in a blind trust if elected. Instead, Gianforte has opted for a “blind investment agreement.”
“While most Montanans are struggling to make ends meet during this pandemic, Greg is financing his gubernatorial campaign with profits derived from insider trading that capitalizes on the COVID-19 pandemic,” the Fox campaign’s email stated.
The blind investment agreement requires Gianforte publicly disclose his investments, which “nullifies any claim of insider trading,” according to Gianforte’s communications director, Trevor Hall. “Greg has no control over his investments,” Hall added, and the blind investment agreement was pursued instead of a blind trust for the sake of transparency.
But Fox’s campaign manager Jack Cutter said the required disclosures allow Gianforte to see where the money is going, defeating the purpose of a blind trust.
According to financial disclosure reports provided by the Office of the Clerk of the U.S. House of Representatives, Gianforte has invested hundreds of thousands of dollars in companies involved in industries that stand to benefit from COVID-19. The actual number could be anywhere from $300,000 to near $1 million, as the transaction reports provide only a range of dollar amounts and not specific numbers.
Many of the investments in question — well over $100,000 — are in a company called NV5 Global. NV5 is a provider of engineering and consulting services and recently announced delivery of services designed to help companies mitigate the risk of COVID-19.
Gianforte’s portfolio manager made investments in NV5 Global as early as Jan. 2 of this year. At the time, the World Health Organization was just starting to learn about a new coronavirus spreading in China’s Hubei Province and the city of Wuhan.
At the same time, Gianforte reported investing up to $50,000 in a company called Roche Holdings, a Swiss pharmaceutical company producing drugs to treat patients with coronavirus. The company also said it is working at “maximum production rate” to make a diagnostic test for the virus.
“Unless Gianforte’s funds manager lives in Wuhan, China, how would he know” to invest that money in companies like NV5 Global? Cutter asked. “The Hill [Capitol Hill] had that information before the rest of America.”
He also pointed out that after the disclosures were made public, Gianforte didn’t stop the investments and continued to have investments in companies like NV5 made in his name.
In late February, Gianforte invested somewhere between $100,000 and $250,000 in a company called Shionogi. Shionogi is involved in the production of rapid testing for coronavirus. In March, Gianforte invested in companies working on treatments for COVID-19, including NoVartis, which manufactures the drug hydroxychloroquine that President Trump claimed can protect against the virus.
“We won’t know until there’s a formal investigation,” Cutter said, about what kind of contact Gianforte might have had with his investment manager.
“As such, his recent investments, at minimum, appear to breach the public trust,” Cutter wrote.
HALL SAID there is nothing credible about the Fox campaign’s claims, and that some of these companies have been part of Gianforte’s portfolio for a long time.
“We would argue that knowing how cash-strapped the Fox campaign is, they didn’t have the money to dig around in Greg’s public disclosure,” Hall said. Instead, according to Hall, it appeared as if the Fox campaign was repeating allegations made by liberal super PAC American Bridge and written out in more detail in late March by a Montana-based liberal blogger.
Hall questioned whether the allegations are substantial enough that Gianfote even has anything to disprove.
According to records provided by the congressman’s office, Gianforte could not have received an official briefing related to COVID-19 until an Engergy and Commerce Committee meeting on Feb. 26. Gianforte’s office also pointed out NV5 Global and Roche did not mention COVID-19 in their press releases until mid-March.
Still, the Montana Democratic Party joined the Fox campaign in calling for more scrutiny of Gianforte’s financial transactions.
“Instead of fighting to get Montana’s health-care workers the essential protective equipment and tests they need, Gianforte is spending his time trying to get even richer,” said Sandi Luckey, executive director of the Montana Democratic Party, in a statement last Friday.
“Gianforte has exploited the COVID-19 pandemic for his own personal gain and lied to voters when he promised to put his assets in a blind trust. Montanans deserve answers — now,” Luckey claimed.
On Thursday, two attorneys — Sean Morrison of Helena and Dustin Leftridge of Kalispell — sent a letter to Fox advising him that if the accusations are true, Gianforte may have violated the Stop Trading on Congressional Knowledge Act.
“As the Attorney General of the State of Montana, we believe you have an obligation to report any information regarding a potential violation of federal securities laws to the SEC and/or the United States Department of Justice,” the letter states.
GIANFORTE IS the richest member of the U.S. House, with a net worth of around $135 million. He entered politics after a career in the technology industry, where he founded RightNow Technologies and later sold it to Oracle for $1.8 billion.
Gianforte joins a number of senators and congressmen who have come under fire for their investments leading up to the pandemic.
Sen. Kelly Loeffler, R-Georgia, faced a backlash after she dumped $20 million worth of stock following a briefing in the lead-up to the coronavirus pandemic. She and her husband also acquired investments in companies that stood to benefit from the pandemic.
Sen. Richard Burr, R-North Carolina, also came under heavy criticism for selling $1.7 million in stocks while assuring the public the nation was equipped to handle the pandemic. He is now being investigated by the U.S. Justice Department.
Fox and Gianforte are seeking the Republican nomination for governor along with Sen. Al Olszewski, R-Kalispell, as Gov. Steve Bullock is being termed out of office. Montana has had a Democratic governor for 16 years, and Montana Republicans see 2020 as a prime opportunity to take back the governor’s mansion.
Reporter Colin Gaiser may be reached at email@example.com