NASHVILLE — Five Tennessee members of Congress, including U.S. Rep. Chuck Fleischmann, R-Ooltewah, as well as U.S. Sen. Bill Hagerty, R-Tennessee, are among 97 members of Congress who have reported trades in companies influenced by their committees, The New York Times is reporting.
Others on the list include Republican U.S. Reps. Rick Allen and Austin Scott of Georgia, according to the Times analysis.
Federal lawmakers aren't prohibited from investing in any company, including ones that could be affected by their actions. The Times, however, cited ethics experts saying trading patterns highlight longtime concerns about the potential for conflicts of interest or use of inside information.
The newspaper said it analyzed transactions between 2019 and 2021 using a database of members' financial filings called Capitol Trades created by 2iQ Research. The trades were then compared against relevant committee assignments and the dates of hearings and congressional investigations.
Fleischmann sold from $1,000 to $15,000 in shares of Emerson Electric, a St. Louis-based manufacturer that operates in the renewable energy sector, according to the Times. The congressman is a member of the House Appropriations Subcommittee on Energy and Water Development, which directs funds to renewable energy programs. It was among 17 reported trades -- and the only one that raised a potential conflict, the Times reported.
A spokesperson for Fleischmann said in an email to the Times that Fleischmann "treats his stock portfolio like a blind trust and is not apprised of any buys, sales or trades."
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The Chattanooga Times Free Press reached out to Fleischmann's spokesman for details Friday about the blind trust-like arrangement but received no immediate response.
Hagerty, according to the Times, reported a sale of shares worth $50,000 to $100,000 of NuStar Energy, a San Antonio, Texas-based petroleum terminal and pipeline operator, while he was a member of a Senate subcommittee responsible for directing funds to Energy Department programs. He also sold shares worth $115,000 to $300,000 in two financial firms while he was a member of a Senate banking subcommittee.
"The firm that manages Senator Hagerty's investments has complete decision-making discretion relating to Senator Hagerty's investments, pursuant to a discretionary management agreement," Hagerty Deputy Chief of Staff for Communications Julia Hahn wrote in an email statement to the Times Free Press. "Senator Hagerty neither directed nor was consulted regarding the sales of these particular investments that he purchased prior to becoming a senator, all of which were promptly disclosed in compliance with the STOCK Act."
That 2012 law prohibits the use of nonpublic information for private profit, including insider trading by members of Congress and other government employees.
U.S. Rep. Diana Harshbarger, a Kingsport, Tennessee, Republican, was described in the Times as "one of Congress's most active filers."
She is a member of the House Committee on Education and Labor, which has considered legislation on drug pricing and billing practices. She or her husband have traded Bristol Myers Squibb, Johnson & Johnson and Eli Lilly, among other drug or health companies.
Last year, Insider reported Harshbarger had failed to disclose in a timely manner more than 700 trades worth $700,000 to $10.9 million. Harshbarger's staff did not respond to requests from the Times for comment. She reported trades in 149 companies among which there were 17 potential conflicts, the newspaper reported.
(READ MORE: As pandemic spread pain and panic, this Democratic congressman chased profit)
U.S. Rep. Steve Cohen, a Memphis Democrat, sold shares of several transportation companies while serving on the House Transportation and Infrastructure Committee, the Times reported. That included $1,000 to $15,000 in Boeing stock while the panel was investigating the company's 737 Max aircraft after two incidents overseas.
In an interview with the Times, Cohen defended his sales, which he said he executed himself.
"I don't do anything that's at all unethical, and I've owned stocks since I was about 25 years old," Cohen, a former Tennessee state senator, told the newspaper. "I've bought them and held them, and I made money."
He said he had frequently criticized some of the companies he owns shares in. In the case of Boeing, he said he purchased the stock in the 1990s and wanted to sell it earlier. But he said he waited until the stock had lost much of its value to avoid criticism. He added he did not believe he had access to information that could help him trade better.
"I consider myself a pretty smart guy," Cohen said. "When it came out about the idea of Congress members making money from their information, I had to think, maybe I'm not very smart, because I've never seen a time when something I learned was something I thought could've made me money."
According to the Times, Cohen reported trades in 34 companies, 10 of which posed potential conflicts
U.S. Rep. John Rose, a Cookeville, Tennessee, Republican, sold all of his shares in three banks in November 2019, including $100,000 to $250,000 in shares of Wells Fargo stock, the Times reported, also noting the Financial Services Committee on which he sat was conducting an investigation into the bank at the time over fake accounts and other misdeeds. Staff members for Rose did not respond to requests for comment. The Times reported Rose made trades in seven companies, three of them posing potential conflicts.
The Times reported that while he sitting on the House's special coronavirus subcommittee, U.S. Rep. Mark Green, a Clarksville Republican, and his wife purchased shares of General Electric. The company received pandemic-related ventilator contracts. The company also contracts with the U.S. military, which is under the purview of another of Green's committees. The congressman's district includes the Tennessee portion of Fort Campbell.
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Green said in a statement to the Times that his and his wife's investments were fully managed by a broker. He also provided a copy of a 2020 letter authorizing the broker to make decisions without his input. He reported trades in 42 companies with one potential conflict.
U.S. Sen. Marsha Blackburn, a Franklin, Tennessee, Republican, did not appear on the Times list. She is co-sponsor of a bipartisan Senate bill that would prohibit members of Congress and their spouses from owning an interest in or trading -- except to divest themselves -- any stock, bond, commodity, future or other form of security. Lawmakers and spouses would be permitted to trade and hold mutual funds and exchange-traded funds, or ETFs, provided they don't present a conflict of interest and are diversified, Roll Call reported in writing about the legislation.
Tennessee's four other U.S. representatives -- Republicans Scott DesJarlais of Sherwood, Tim Burchett of Knoxville and David Kustoff, a former federal prosecutor, and Democrat Jim Cooper -- did not make the Times list.
U.S. Rep. Marjorie Taylor Greene, a Rome, Georgia, Republican, didn't make the list either.
Georgia Republican Congressmen Rick Allen and Austin Scott did.
Allen reported trades in pharmaceutical companies Merck and Johnson & Johnson while serving on an Education and Labor subcommittee that was considering prescription drug price legislation. The Times reported his office did not respond to requests for comment. He reported trades in 25 companies, posing three potential conflicts, according to the newspaper, among them Deere & Co. and Johnson & Johnson.
Scott and his wife, according to the Times analysis, bought and sold shares in General Electric in late 2020. The company is a military contractor. Scott is a member of the House Armed Services Committee. A spokesperson confirmed that Mr. Scott's wife owns less than $20,000 worth of GE stock in an inherited retirement account.
Neither U.S. Sens. Jon Ossoff nor Raphael Warnock, both Georgia Democrats, appear on the list.
Ossoff is part of an effort to pass new legislation to supercede the STOCK Act. which has been criticized for loopholes and perceived ineffectiveness.
He and U.S. Sen. Mark Kelly, D-Arizona, this year introduced the Ban Congressional Stock Trading Act. It would require members of Congress, their spouses and dependent children to place certain investments into blind trusts or divest them while serving. Members found violating the rules would be fined the amount of their entire salary.
Ossoff, a former investigative journalist whose company exposed corruption, said in introducing the bill in January that he put his own stock portfolio in a blind trust last year, making him and Kelly two of just 10 members of Congress to do so. He cited polling showing Democrats, Republicans and independents favored the legislation by large majorities.
"Members of Congress should not be playing the stock market while we make federal policy and have extraordinary access to confidential information," Ossoff said in a statement announcing the legislation.
Despite support from top House and Senate leaders, the legislation has languished.
Contact Andy Sher at asher@timesfreepress.com or 615-255-0550. Follow him on Twitter @AndySher1.