Politics

Welch profited from investment in COVID-19 testing firm

Less than a month ago, as he received briefings on the coronavirus, Rep. Peter Welch purchased more than $7,500 worth of stock in Qiagen, a German diagnostics company that produces COVID-19 tests and, in the midst of a global economic meltdown, has been a rare company with a rising stock value.

In an interview Tuesday, the Vermont Democrat said the purchase was made by his investment adviser and without his consultation. “I can assure you that I had no knowledge of the purchase,” he said. “I had never heard of the company Qiagen.”

Welch said he sold the Qiagen stocks Tuesday and planned to donate all profits from the transaction — he estimated somewhere between $300 and $500 — to the Committee on Temporary Shelter (COTS), a Vermont-based charity that helps the homeless.

A spokesperson for Welch said he purchased 210 shares less than a month ago at $36.36 a share, an investment of $7,635.60. Shares sold for as low as $38.81 on Tuesday and closed with a high for the day at $39.86, meaning Welch walked away with between $8,150.10 and $8,370.60, a profit of $514 to $735, depending on what time of the day he sold.

VTDigger inquired about the purchase by email on Monday.

Qiagen has developed a test that can differentiate between the coronavirus and 20 other respiratory ailments with results in an hour.

Welch is not the only person on Capitol Hill who invested wisely in recent weeks. According to Politico, a number of lawmakers and congressional aides have recently bought and sold stocks tied in various ways to the coronavirus crisis. The most prominent examples were two Republican senators, Richard Burr and Kelly Loeffler, who unloaded millions in stocks shortly before the market crashed. 

According to federal financial disclosure forms, Welch purchased the Qiagen stock on Feb. 27. In early February, the House Intelligence Committee, of which Welch is a member, received a COVID-19 briefing from America’s spy agencies, Reuters reported. Welch appears to have first publicly expressed serious concerns over the coronavirus on Feb. 26, in a co-authored letter to President Donald Trump.

Welch acknowledged attending recent intelligence briefings, but said he was barred from commenting on their contents. He contended that congressional briefings do not influence his investment portfolio, and said he was first alerted to the coronavirus threat through public channels. “I know the first information I heard about corona was in the newspaper,” he said.

VTDigger is underwritten by:

While Vermont’s two U.S. senators, Bernie Sanders and Patrick Leahy, are invested in a number of mutual funds, their investment activity is much less active than Welch, the state’s sole U.S. representative.

In 2019 alone, Welch purchased between $16,000 and $240,000 in investments including stocks in companies like General Mills, as well as purchasing Treasury notes. Welch, whose work on the House Committee on Energy and Commerce often involves oversight into technology and consumer goods, has also invested in a number of tech and consumer goods companies, including Orbotech, Church & Dwight, and Mitek Systems. 

U.S. Rep. Peter Welch speaks at a press conference in Barre on March 16, 2020, along with Scott administration officials about the impact of the coronavirus. Photo by Glenn Russell/VTDigger

In late October, for instance, Welch purchased between $1,000 and $15,000 of stocks in RegenxBio, a company developing gene therapy treatments. Less than two weeks later, on Nov. 8, Welch sold the RegenxBio stocks shortly after the FDA announced it had put a partial development hold on the firm’s leading gene project, which seeks to treat vision loss.

Asked if he has set specific rules for his investment adviser, Welch answered “no pharma.” Asked if he had ever discussed not investing in companies that could potentially see their business under scrutiny by his congressional committees, Welch said he hadn’t. 

In 2018, VTDigger reported that Welch was heavily invested in health care companies while pushing a controversial law that some said curtailed the ability of federal authorities to stem elicit black market prescription drug channels. In 2012, the Wall Street Journal reported that Welch held stocks in financial firms as Congress debated new regulations on Wall Street firms. 

Welch told VTDigger in 2018 that he did not support a ban on congressional stock trading, but pointed out he had been a proponent of the 2012 Stock Act, which formally banned insider trading in Congress. In 2017, former Rep. Chris Collins, R-N.Y., was investigated for insider trading under the Stock Act. He later pleaded guilty to insider trading.

In an interview Tuesday, Welch pointed out that the Stock Act mandated disclosure of congressional investment transactions. “It’s because of that law that you and others were able to see that purchase,” he said. “Transparency is what is really important here.” 

In recent years, a number of progressive lawmakers, including Sen. Elizabeth Warren, D-Mass., have floated legislation that would ban members of Congress from trading individual stocks. In recent days, Democratic Rep. Alexandria Ocasio-Cortez of New York announced plans to draft a House bill that would ban stock trading. 

Asked if he would support such legislation, Welch expressed qualified support. “I’m very open to it and I’m going to look at it,” he said.

Sign up for our guide to the global coronavirus outbreak and its impact on Vermont, with latest developments delivered to your inbox.

 

VTDigger's comprehensive Covid-19 coverage relies on your financial support. Become a member today.

Jasper Craven

About Jasper

Jasper Craven is a freelance reporter for VTDigger.

A Vermont native, he first discovered his love for journalism at the Caledonian Record. He double-majored in print journalism and political science at Boston University, and worked in the Boston Globe’s Metro and Investigative units. While at the Globe he collaborated on Shadow Campus, a three-part investigative series focused on greed and mismanagement in Boston’s off-campus student housing market. The series was a finalist for the 2015 Pulitzer Prize.
He also spent two years at MuckRock, a news site dedicated to investigation and analysis of government documents. 

Craven covered Vermont’s U.S. congressional delegation for the Times Argus in the summer of 2014, and worked as a Metro reporter for the Chicago Tribune before joining the staff of VTDigger from 2015-2017.

Email: [email protected]

Follow Jasper on Twitter @Jasper_Craven

Reader Footnotes

Please help move our stories forward with information we can use in future articles.

Readers must submit actual first and last names and email addresses in order for notes to be approved. We are no longer requiring readers to submit user names and passwords.

We have a limit of 1,000 characters. We moderate every reader note.

Notes about other readers’ points of view will not be accepted. We will only publish notes responding to the story.

For more information, please see our guidelines. Please go to our FAQ for the full policy.

About voting: If you see voting totals jump when you vote on comments, this indicates that other readers have been voting at the same time.
1000
30 Comment threads
0 Thread replies
0 Followers
 
Most reacted comment
Hottest comment thread
29 Comment authors
newest oldest most voted
J. Scott Cameron

Does Digger believe our country would be better off if no one invested in companys that performed medical testing? Was the spread of the corona virus a state secret “less than a month ago” or a commonly known fact (except perhaps to our president). Inquiring minds want to know.

Jim Barrett

The politicians are all so smart before being caught and then they don’t have any recollection of anything after.

Wayne Curley

At the end of all this, Congress should not only investigate themselves but also investigate how much money Trump, the Trump Companies, his family members and members of his administation have made during his term as President. Concentrate on how the decisions he has made have been tied to specific purchases and sales.
It will also be interesting to see what advantages Trump’s real estate investments, like Mar Ra Lago, hotels and golf courses gain from any aid packages Congress hands out.

James wiley

I don’t believe you peter and neither does anyone else.

Vicki Ward MSN

You think Transparency is the only issue when public servants gain inside information and make lots of cash??! Did you ever attend an Ethics class or hear that word somewhere? Where does Corruption start? Self gain from public good? But, no new roads or bridges or public good? As the song says, “who do you think you are fooling?”

Bob Schwartz

This article, and other recent antics in Congress, points out the need for 2 critical changes that need to be made to restore faith and objectivity in our legislative branch – term limits and mandatory blind trusts for those who serve.

Paul Richards

I’m not a Welch fan but I don’t believe this is some major case of insider trading. If someone can come up with additional proof of him getting very specific information on this I may change my mind.

Jenny Kingsbury

I’m waiting for the “big business outrage”from Bernie …

Rama Schneider

While the gop supported trump administration was busy telling us how wonderful all things were, the coronavirus was spreading around the globe. As we all know today, trump & pals were very aware of how totally misleading his/their public comments were – they knew because they intended to mislead the public.

Congress needs to stop acquiescing in demands for secrecy in order to hear classified information. This habit has proven over and over to be a grave threat to our lives, freedoms, and democratic institutions. We should have known from the get go that ONCE AGAIN our intelligence agencies were seeing facts on the ground that showed trump was once again lying to the United States.

Joe Sobieskie

Headline should have read:
Welch Donates Gain from Testing Lab Stock for Homeless Shelter

Emmett Hughlett

Excellent reporting. VT Digger’s credibility up one notch for this. However, I doubt he would risk his reputation for so small a possible gain. I’d be very happy if he left office, but this ain’t it.

Jeff Dardozzi

The cold calculus of money, power and crass opportunism.

Peter Everett

Those of us in the Middle Class, don’t have the spare money to invest in stocks. The wealthy and the elite (politicians) have the sufficient funds to do so. Plus, the politicians know when to buy and sell long before the general public. Does anyone really believe that they are capable of self governing themselves on this? They will never kill the the Golden Goose that led to them becoming extremely wealthy. This may well be a reason ( 1 of them) why they are career politicians against term limits. Think: Would you ever want to leave such a cushy position, where you do little, travel the world on others dime, great benefits and retire with vast wealth? This applies to D’s and R’s. The corruption is bipartisan. Everyone is in on the game that sits, or, has sat in Congress. If you were there, you would also. It’s just plain, simple human nature. That’s one of the reasons the Founders wanted limited government. The knew that, we, humans have many faults. Government grew too big!

jeffrey green

I’m no fan of Mr. Welch, but this is a silly game of “Gotcha”. It wasn’t insider trading…he had no “crystal ball” of how bad things would get, or if they would not get that bad. He had no idea if this firm really had anything to help…dozens of companies do similar work & compete….what if this firm didn;t get the hoped virus work? He doesn’t know. Wall Stret now just trades on a daily “narrative”. That is all Mr. Welch did….the virus is a worldwide daily “narrative’. It is nice he donates any TINY profit… a few HUNDRED dollars???? …Mr. Welch he has nothing to be ashamed of. Rather, the people that try to make “hay” out of this…. do. Shame on those that do.

Jay Eshelman

It matters not if Mr. Welch “had never heard of the company Qiagen.” What matters is whether or not the insider knowledge of this pandemic was transmitted (i.e. leaked) to someone, who told someone else, who told his stockbroker, that test kits were in short supply. Crony capitalism is unacceptable no matter which party partakes in it. After all, the law cites the ‘appearance of a conflict of interest’. Mr. Welch and his stockbrokers should know better.

Gary Murdock

This is not the real problem…the real problem is that Welch and his party have decided to NOT vote today on the stimulus package hammered out and passed on a bipartisan vote in the Senate. Welch and his leaders are holding out for green new deal nonsense, arts funding, changes to voting laws to allow vote harvesting, etc., etc., etc. House democrats like Welch have chosen unrelated party priorities over relief for the country. If this doesn’t illustrate the importance of re-taking the House nothing will…the country is lost. Don’t take my word for it, look it up in other news sources, because it wont be reported here.

JD Ryan

All the more reason to pass that law prohibiting the buying and sales of stock for all members of Congress. Elizabeth Warren is right, on this.

Glenn Thompson

As an investor and someone who has *no use* for Welch, this is a non-issue. Especially if someone else is managing his investment portfolio. I’m more disturbed about the proposals being put forward by Elizabeth Warren and AOC.

morgan rye

given the information these people are privy to maybe there should be some legislation regulating stock ownership. it might eliminate some of the class issues in the congress. this kind of stuff has been going on forever and it is the fox in charge of the hen house in terms of them legislating and judging themselves. it is of course disgraceful but i think at the moment there are bigger fish to fry in the country.

Mike Edward

This is a simple case of insider trading. Similar to what put Martha Stewart in prison. Now Peter got caught and will have to face investigation as anyone else, regardless of the amount of money he invested. As a centrist, I agree with the Dems push to make individual investments or concentrated mutual fund investments illegal for those currently serving in office. This may encourage politicians to not make lengthy careers out of public office if they wish to be individual stock investors.

Tim Vincent

“Welch is not the only person on Capitol Hill who invested wisely”
And they all say the same thing:
“My financial advisor did it without my knowledge.”
If you believe this, I have a pair of unicorns for sale.
Remember Harry Reid?
Grew up in a shack in the Nevada desert, regular Abe Lincoln.
Entire career in “public service.”
Retired a multi-millionaire.

John Zampieri

I have known Peter Welch for many years…served in the legislature with him….and always found him to be a person of integrity and character . For him to take the risk to purchase some stocks does not concern me…what concerns me are the U.S. Senators who got inside information and dumped shares and made millions!!
Peter keep up the good work for us.

Paul Richards

We should be concerned about those who come to work in government with little to nothing and leave a millionaire. How does this happen? We should be less concerned about those coming to work for government that enter as millionaires and lose money while in office.
What ever happened to the concept of real people like farmers coming to congress, serving their time and then returning to the fields? That’s what we are missing: the common sense and fresh ideas from real people, from all walks of life. Now we get a bunch of lawyers who have huge staffs and enrich themselves for life while having no concept of the average citizen’s world.

John Freitag

Legislators should be focused on the good of the country. Stocks if they have them should be put, as many do, in a blind trust for as long as they serve. In the best case scenario, even if there was nothing done wrong by Representative Welch, the optics are terrible. Time to learn a lesson from this one Peter and become a leader on a bill that would ban stock trading by members of Congress.

Mike Rouelle

Maybe Mr. Welch should tell his investment firm what he does for a living and ask them not to put him these predicaments (conflicts) if there is even a remote chance he would get caught. They don’t like getting caught with their hand in the cookie jar!!! Maybe invest in a shadow name!!

James Berry

Non-issue if purchase were in fact “blind”. Investing in companies is the American way, including all the teacher and public employee pension funds.
I have a huge problem with a public official insisting of travel to a private resort they own , on the tax payers dime, in tax payer planes, then charging the security and public staff for staying there at the official’s insistence. Trump’s golf travel has now cost us over $135m…insane. For the love of god, no more elective golf trips for any president going forward.
A true Comservative has both social conservative values AND fiscal conservative (“don’t spend what you don’t have, don’t waste $, work hard to save tax payer funds”)

Douglas Shane

It’s clear that these politicians who are benefiting from stock market trading need to advise their “advisers” not to buy or sell any stock that has even the remotest appearance of insider trading or financial gain.
Would Rep. Welch be donating his $300 – $500 gain if the story hadn’t been revealed?

Robert Lehmert

“A spokesperson for Welch said he purchased 210 shares [for] $7,635.60. […]Welch walked away with between $8,150.10 and $8,370.60, a profit of $514 to $735, depending on what time of the day he sold.”

In October — months before COVID was even discovered by anyone on Earth.

Yawn.

Accusing public figures should have some basis in plausibility. The foundation of this story is not plausible.

Just because you can, does not mean you should.

don white

not really Welchs fault. The voters are responsible for voting for politicians who have made laws essentially allowing insider trading amongst members of congress and their immediate families. Its not any fault of Peter’s. VT voters need to take serious look at who they vote into office and for why. Wasting ones vote on how much free money or federal dollars (this is actually not free, but tax payer funds.) the gov can give their nonprofits or welfare roles is not sound policy. The privilege of having a vote and to participate in a system of government as we do should not be squandered for the personal gains of small groups or individuals. It was evident again yesterday when Bernie, who is running a loosing campaign decided to interject. Stopping support our hospital and health care workers. His cheap political tricks have again stalled any legislation. Peter is a house member yet his body and party wish to pass through political agendas instead of relief for front line medical.

Jay Morse

This is common. How do you get elected to a position that pays $150k a year, go live in expensive Washington and come home rich? This is part of the how.

 

Recent Stories

Thanks for reporting an error with the story, "Welch profited from investment in COVID-19 testing firm"