Sen. John Fetterman violates financial law with botched corporate bond disclosures
Sen. John Fetterman (D-PA) and three other members of Congress appear to have violated federal law by filing late financial disclosures.
Reps. Stephanie Bice (R-OK) and Sean Casten (D-IL), along with Sen. Bill Hagerty (R-TN), were also tardy in reporting investment transactions.
Fetterman this week formally reported 30 corporate bond transactions and one stock sale made on behalf of his dependent children during 2023 — with the oldest transaction reported about 17 months after a federally mandated deadline.
An unidentified dependent child made a partial sale of stock in petroleum company Marathon Oil on Jan. 24, 2023, valued between $1,001 and $15,000. (Fetterman and his wife, Gisele, have three school-aged children.)
The 30 corporate bonds include investments in a variety of companies, including multinational conglomerate General Electric, electric services company Florida Power and Light, petroleum company Phillips 66 Partners, steel producer Steel Dynamics and multinational financial services company, Bank of America.
The corporate bonds are valued between $58,030 and $430,000 total. Lawmakers are only required to disclose investment values in broad ranges.
“Sen. Fetterman filed an amendment to his financial disclosures that included investments for his children that were created by generous grandparents who were unaware of the reporting requirements,” said a spokesperson for Fetterman’s campaign, who declined to be named. “Once Sen. Fetterman was made aware of the investments, he immediately filed the appropriate disclosures.”
A Raw Story review of Senate financial records indicated that Fetterman had never reported these transactions prior to this week. This represents a violation of the Stop Trading on Congressional Knowledge (STOCK) Act, which requires a lawmaker to publicly disclose stock and corporate bond trades — or such trades by their spouse or dependent children — within 45 days of a transaction.
Fetterman's office did not respond to follow-up inquiries.
Members of Congress are personally responsible for adhering to the provisions of the STOCK Act. First-time STOCK Act scofflaws typically receive a $200 fine, although Congress can choose to waive the fine.
In extreme circumstances, STOCK Act violations can be investigated internally by the House or Senate ethics committees or externally by the Department of Justice.
Fetterman supports trading ban
Fetterman emphasizes a ban on congressional stock trading on his official website and is a co-sponsor of the Ending Trading and Holdings in Congressional Stocks (ETHICS) Act. An amended version of the bill advanced out of the Senate Committee on Homeland Security and Governmental Affairs last month.
Fetterman’s campaign website emphasizes his belief in a transition to cleaner energy while protecting union jobs in the sector. The website mentions Fetterman’s support of American oil companies but calls out "greed" from industry giants like BP, Shell, Chevron and ExxonMobil.
Fetterman serves on various Senate committees including Agriculture, Nutrition and Forestry; Banking, Housing and Urban Affairs; Environment and Public Works; the Joint Economic Committee and the Special Committee on Aging.
“Lawmakers should not be able to profit off the same companies that they are regulating. Letting members of Congress trade stocks opens the door to corruption,” Fetterman said at a press conference introducing the ETHICS Act in 2023. “Lawmakers should be focused on getting results for their constituents — not lining their own pockets.”
The disclosure slip-up is the latest challenge in a turbulent year for the freshman senator. Fetterman and his wife were in a car accident in June, and Fetterman has been recovering from a stroke he suffered during the 2022 election that left him with auditory processing impairment. Fetterman took a leave of absence from the Senate in 2023 to seek treatment for clinical depression.
Other STOCK Act violators
Casten reported three purchases of corporate securities in carbon removal company, Myno Carbon Corporation, between two to eight months late.
The investments were valued between $30,003 and $115,000 total.
Earlier this year, Casten was as much as two-and-a-half years late in some cases in reporting eight purchases of stock in the same company through a family investment vehicle.
“These transactions were loans and equity investments made by Rep. Casten’s family investment firm, a company in which he holds a minority, non-controlling stake and has no active participation in,” Jacob Vurpillat, Casten’s congressional spokesperson, told Raw Story via email. “They were made by a family member without Rep. Casten’s prior knowledge. Upon learning of the transaction, he proactively consulted with the House Ethics Committee to determine how to best disclose them to the public.”
Casten is a co-sponsor of the Ban Conflicted Trading Act, introduced in the 117th Congress.
“Rep. Casten does not own individual stock, has not owned any during his time in Congress, and is a long-time supporter of the movement to ban members of Congress from trading individual stock,” Vurpillat said.
Bice reported two U.S. Treasury bill purchases as part of a joint trust from 2023, reported between nine months and a year late, according to U.S. House records. The purchases were each valued between $15,001 and $50,000.
Bice’s congressional office did not respond to Raw Story’s request for comment.
Hagerty reported a stock exchange in Crestwood Equity Partners LP on Nov. 6, 2023, about eight months after the 45-day deadline.
A note on Hagerty’s report said, “While no immediate [periodic transaction report] required, provided to clearly denote basis for the renamed asset on the 2023 annual report that was previously named CEQP.”
“Sen. Hagerty worked closely with the Senate Ethics Committee to properly document why this asset was renamed on his 2023 annual report in order to be fully compliant with the Committee’s rules. Here, there was no economic change—rather, the security involved is reflected under a different name on this year’s report as a result of a merger transaction," said Audrey Traynor, a spokesperson for Hagerty. "Sen. Hagerty did not purchase or sell the asset, but simply filed a periodic transaction report to clearly and transparently document the reason for the name change on the annual report.”
A Raw Story review of financial disclosures did not show a periodic transaction report — the formal name of a congressional financial disclosure for assets the STOCK Act mandates must be reported within 45 days of a transaction — previously filed for the asset.
Members of Congress are required to publicly report most purchases, sales and exchanges of stocks, bonds, commodity futures, securities and cryptocurrencies by the 45-day deadline.
The Senate and House Ethics committees have historically advised members of Congress to disclose investment transactions as the result of mergers, but there's often confusion on the exact requirements.
A January memo from the House Committee on Ethics to all House representatives, employees and officers makes it clear that stock exchanges must be reported according to the STOCK Act’s disclosure requirements.
But buried on page 40 of the Committee's 2023 guide is this statement: “Exchange transactions are somewhat rare and refer only to a limited set of circumstances that involves the exchange of stock certificates following the purchase of one company by another, a merger of two companies, or a spinoff of one company from another. Exchanges are only reportable when the original stock owned is surrendered for new stock. Please consult with Committee staff for further guidance.”
Hagerty previously violated the STOCK Act in 2022, according to Business Insider. He also reported in 2022 that his four children are minority owners, alongside actress Reese Witherspoon and professional football player Derrick Henry, in Nashville’s major league soccer team.
Fetterman, Bice and Hagerty join Casten on a list of more than 50 members of the 118th Congress who Raw Story found to have violated the STOCK Act, mostly with late financial disclosures.
Other lawmakers have reported stock trades that potentially conflict with their official responsibilities, such as lawmakers who trade defense contractor stock while sitting on a congressional committee with defense oversight responsibilities.
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