Lawmakers Bet On Stocks, Horses
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By BRODY MULLINS and NAFTALI BENDAVID
WASHINGTON—The nation's lawmakers include those who bet on stock declines, won at the race track and one who upped his bet on a Greek bank.The details are included in Congress's annual financial-disclosure statements, released Thursday, which provide an unparalleled window into the finances of sitting congressmen.
The financial forms, which cover 2011, show how some lawmakers or their families invested in risky, leveraged funds to bet against the market. Rep. Timothy Walberg (R., Mich.) invested in a leveraged fund that goes up as the Nasdaq index declines. Mr. Walberg reported he bought shares in the fund, called Proshares Ultrashort, in March and sold it six months later. He did not report a gain. He also made between $201 and $1,000 on a bet the semiconductor industry would decline in 2011, the forms show.
A spokeswoman for Mr. Walberg did not return requests seeking comment.
The husband of Sen. Kirsten Gillibrand (D., N.Y.) made several bets that stocks would decline. Mrs. Gillibrand's husband bet between $1,001 and $15,000 against the stocks of Abercrombie & Fitch Co., Bed Bath & Beyond Inc. and Deckers Outdoor Corp., among other companies, the disclosure forms show.
All but two of the transactions made money. One of his biggest gains came from bets that Royal Caribbean Cruises Ltd. would decline.
Glen Caplin, a spokesman for Mrs. Gillibrand, said there was nothing improper about the trading, and he noted that she championed legislation tightening insider-trading rules for Congress.
The public release of the financial-disclosure forms comes a few months after the passage of that law, which made clear it is illegal for lawmakers to trade stocks based on information they gather in their government duties. Members of Congress are still permitted to trade stocks—and to bet on stock declines—even in companies that they oversee as part of their committee assignments.
The financial-disclosure forms show House Speaker John Boehner (R., Ohio) invested in some of the Republican Party's least favorite companies: housing-finance entities Freddie Mac and Fannie Mae. Mr. Boehner bought and sold between $15,001 and $50,000 of stock in Freddie Mac last summer. In January, he invested $15,001 to $50,000 in Fannie Mae, then sold between $2,000 and $30,000 of the stock in February, trades that were highly profitable.
Republicans have criticized Fannie Mae and Freddie Mac, both of which are now controlled by the government, saying they played a key role in the financial crisis.
A Boehner spokesman said that like many top government officials, the speaker doesn't have direct control over his financial investments.
Mr. Boehner's counterpart, House Minority Leader Nancy Pelosi (D., Calif.), is married to wealthy businessman Paul Pelosi, owner of the Sacramento Mountain Lions, a football team that is part of the United Football League. Mr. Pelosi increased his investment in the team by at least $2 million, Ms. Pelosi's disclosure form showed.
Senate Majority Leader Harry Reid (D., Nev.), who fought a tough battle for re-election in 2010, paid off a campaign loan of between $50,001 and $100,000 that he had taken out with Meadows Bank in Las Vegas.
At a time when Congress is gridlocked over legislation to block an interest-rate increase in student loans, some members of the Senate are still paying off their own college debts. Sen. Marco Rubio (R., Fla.) still owes between $100,000 and $250,000 in student loans. Sen. Mike Lee (R., Utah) still owes between $10,000 and $15,000. And Rep. David Schweikert (R., Ariz.) disclosed that he owes just over $50,000 from his M.B.A. studies at Arizona State University, according to his spokeswoman, Rachel Semmel.
Despite turmoil in Greece, one lawmaker decided to build up a financial stake in a large Greek bank. Sen. Mark Begich (D., Alaska) purchased stakes worth between $1,001 and $15,000 each in the National Bank of Greece on five occasions, the records show. Its stock price fell from more than $20 a share to less than $2 by the end of the year.
A spokeswoman said Mr. Begich has owned the stock since before he became a senator, and that he is "an active trader."
Meantime, Rep. Loretta Sanchez (D., Calif.) won between $1,001 and $15,000 from a horse race in California. And Sen. Kay Bailey Hutchison (R., Texas) made a total of $47.19 in residual payments for an appearance on an episode of "Walker Texas Ranger" more than a decade ago.
Tom McGinty, Janet Hook, Patrick O'Connor, Andrew Seidman and Daniel Lippman contributed to this article.
Write to Brody Mullins at brody.mullins@wsj.com and Naftali Bendavid at naftali.bendavid@wsj.com
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Home > LI Confidential > Stop scratching on holidays
Stop scratching on holidays
Published: June 1, 2012
Off Track Betting in New York State has been racing into a crisis called shrinking revenue. Some people have spitballed a solution: Don’t close on holidays.
New York State Racing Law bars racing on Christmas, Easter and Palm Sunday, and the state has ruled OTBs can’t handle action on those days, even though they could easily broadcast races from out of state.
“You should be able to bet whenever you want,” said Jackson Leeds, a Nassau OTB employee who makes an occasional bet. He added some irrefutable logic: “How is the business going to make money if you’re not open to take people’s bets?”
Elias Tsekerides, president of the Federation of Hellenic Societies of Greater New York, said OTB is open on Greek Orthodox Easter and Palm Sunday.
“I don’t want discrimination,” Tsekerides said. “They close for the Catholics, but open for the Greek Orthodox? It’s either open for all or not open.”
OTB officials have said they lose millions by closing on Palm Sunday alone, with tracks such as Gulfstream, Santa Anita, Turf Paradise and Hawthorne running.
One option: OTBs could just stay open and face the consequences. New York City OTB did just that back in 2003. The handle was about $1.5 million – and OTB was fined $5,000.
Easy money.
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