The revelations came as part of a New York Times investigation that looked at the private financial dealings of lawmakers and their immediate family members. The investigation highlights long-time public concerns over lawmakers potentially profiting from stock trading based on insider information, and their lack of stricter, self-imposed laws to prevent possible conflicts of interests.
Overall, the investigation found that nearly a fifth of Congress or their immediate family members bought or sold stocks in industries that could be impacted by the legislative committees on which they serve.
The Long Beach Democrat, who is retiring this year after his fifth term, was among 97 members of Congress with questionable stock trading practices from 2019 to 2020. His wife Dr. Deborah Malumed sold the Boeing stock the day before the U.S. Transportation Committee received bad news about Boeing’s planes.
When contacted by the Times, all of the members said their transactions were proper and many had been carried out by a spouse or stock broker.
Lowenthal, 81, is a former Long Beach city councilman who has served in Congress for the past decade.
In addition to the Boeing stock, the Times also reported that his wife bought shares in a company called Sunrun that provides home solar energy systems while Lowenthal, a longtime renewable energy advocate, served as chairman of an energy subcommittee.
In an interview with the Long Beach Post, Lowenthal said he personally does not own any stock and that his wife owns stocks that were purchased after she inherited money from her late parents.
The Boeing transaction was carried out by his wife’s financial adviser without the couple’s knowledge, he said, adding that the timing “turned out to be a coincidence” as shares had been dropping for some time due to Boeing’s 737 MAX problems and that word had spread about a pending damning Congressional report.
Lowenthal said he was also unaware of the Sunrun stock and was not involved in his wife’s finances.
“I have never talked to my wife about her financial dealings,” he said.
While Lowenthal said he doesn’t believe there is a conflict of interest in his case, he said he supports legislative reform that would put finances for Congressional members in a blind trust to prevent members from selling stocks individually. The move would prevent possible conflict of interest and improve public perception, he said.
“I think as long as there is the appearance of impropriety in Congress it increases the distrust of our constituents,” he said. “Congress needs to police itself better.”
Last week, House Speaker Nancy Pelosi said a bill banning Congress members from trading individual stocks could go to vote this month.
The Ban Congressional Stock Trading Act, introduced in January by senators Jon Ossoff, D-Georgia, and Mark Kelly, D-Arizona, would prevent members of Congress and their families from buying and selling stocks while holding office.
“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.
When asked for comment, a staff member for Long Beach Mayor Robert Garcia, who is running for Lowenthal’s Congressional seat in November, sent links to tweets Garcia posted in July in which he supported reforms to congressional stock trading laws.
In Congress, I’ll support legislation on day one to ban members from trading stocks.
— Robert Garcia (@RobertGarcia) July 29, 2022
Thank you so much for supporting Jon Ossoff’s Senate campaign.
Thank you so much for supporting Joe Biden’s Presidential campaign.