Tags: House | SEC | stock | spike

House Panel Subpoenaed by SEC After Report on Stock Spike

Wednesday, 18 Jun 2014 09:39 PM

The House Ways and Means Committee and a congressional aide were subpoenaed by U.S. prosecutors and federal securities regulators, according to public disclosures.

The subpoenas are related to an investigation into whether congressional staff illegally passed on nonpublic information about a change in U.S. health-care policy that was used to trade stocks, the Wall Street Journal reported Wednesday, citing unnamed people familiar with the inquiry.

The Securities and Exchange Commission subpoenaed the House Ways and Means Committee and aide Brian Sutter, according to notices in the Congressional Record. The SEC sought documents from the committee and documents and testimony from Sutter.

Sutter is the staff director of the committee’s health subcommittee. The U.S. Attorney’s Office in Manhattan also issued a grand jury subpoena to Sutter seeking testimony, according to his disclosure.

Sutter and Sarah Swinehart, a committee spokeswoman, didn’t immediately respond to a request for comment on the subpoenas after normal business hours. John Nester, an SEC spokesman, and James Margolin, a spokesman for the U.S. Attorney’s Office, declined to comment.

The probe into whether insider trading occurred on changes in health policy has been active for more than a year and was prompted by a report about how health-insurance stocks spiked ahead of government announcements favorable to those companies regarding Medicare payments, the Journal said.

The subpoenas, which are the first to Congress involving a federal insider-trading probe in almost 10 years, reflect a new focus at the SEC and the Justice Department on possible violations of securities laws based on information about government policy, the paper said.

Peter Carr, a Justice Department spokesman, didn’t immediately respond to an e-mail sent after hours seeking comment.

A 2012 law requires public officials to keep confidential any non-public information about government matters that could move stock prices.

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InvestingAnalysis
The House Ways and Means Committee and a congressional aide were subpoenaed by federal prosecutors and securities regulators in connection with an investigation into whether congressional staff illegally passed on nonpublic information, the Wall Street Journal reported Wednesday.
House, SEC, stock, spike
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2014-39-18
Wednesday, 18 Jun 2014 09:39 PM
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