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Is Nancy Pelosi’s Husband Guilty of Insider Trading?

esposo de Nancy Pelosi

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Paul Pelosi, Nancy Pelosi’s husband (D-CA), the Speaker of the House of Representatives, maintains his streak in the U.S. stock market, as his investments seem to preempt every Congressional and Executive decision that affects the companies in which he invests.

On March 21, Paul Pelosi, acquired several call options on Amazon stock which closed at $3,259.05 that day. A call option is an option to buy stock in the future at a pre-agreed price. These prices are guided by forward-looking expectations of the stock’s valuation in the day-to-day market.

Six weeks after the purchase of the options, the Pentagon announced big news for Amazon and Mr. Pelosi, as it rejected the $10 billion contract with Microsoft to establish a cloud computing service for the Pentagon, the Joint Defense Infrastructure (JEDI) platform.

Nancy Pelosi's husband - El American
Nancy Pelosi’s husband investments have surprised the market due to the timing they seem to have in front of Congress decisions that affect the companies he invests in. (EFE)

The JEDI project and Nanci Pelosi’s husband ‘premonition’

The Pentagon in 2019 had awarded a contract to Microsoft to modernize its artificial intelligence (AI) infrastructure. Amazon Web Services also bid on the Pentagon’s bid, but in the end, the decision went in Microsoft’s favor.

A month later, Amazon’s legal unit filed a lawsuit in the U.S. Court of Federal Claims protesting the decision to award the JEDI building contract to Microsoft. According to the lawsuit filed by Amazon, then-President Donald Trump was clearly biased against Amazon and its owner Jeff Bezos, so there may have been pressure on the Pentagon to favor Microsoft in the bidding process.

The Pentagon clarified that it received no pressure from the White House to award the JEDI contract to Microsoft, however, it claimed there was “limited cooperation” from Trump administration officials in reviewing the bids.

Pentagon - Amazon - JEDI Program - El American

Now, with the cancellation of the Microsoft contract, the Pentagon will seek a new deal with Amazon, Microsoft, and other cloud computing service providers to continue with the development of the JEDI project.

Naturally, the change of decision by the Pentagon caused a jump in Amazon’s share price and also in the pockets of Nancy Pelosi’s husband, who in less than six weeks could see a high valuation on his investment in the world’s largest company.

Another case of Paul Pelosi’s “insightfulness”

But, the story does not end there. On May 21, Nancy Pelosi’s husband, invested up to $6 million in stock in the group of companies known as FAANG (Facebook, Amazon, Apple, Netflix, and Google/Alphabet).

Paul Pelosi invested up to $250,000 in 50 Apple stock options, priced at $100 per share, that would expire on June 17, 2022. Pelosi, also invested $1 million in 20 Amazon call options (also expiring on June 17, 2022).

By June 18, Paul exercised an Alphabet stock option, giving him the right to buy 4,000 shares of the tech giant at a price of $1,200. The option was acquired on February 27, 2020.

Según el equipo de prensa de Nancy Pelosi, la representante no tiene ningún conocimiento de las transacciones de su esposo, Paul Pelosi. (EFE)
According to Nancy Pelosi’s press team, the representative does not have any knowledge of her husband’s transactions. (EFE)

The curious thing here is that on June 11 the House Judiciary Committee advanced several bills that would regulate the market power of technology companies, which would naturally add volatility to the stock price of these companies.

This is not the first time Nancy Pelosi’s husband has made investments close to an announcement or decision in Congress. In March, Paul Pelosi exercised $1.95 million worth of Microsoft stock options just two weeks before Microsoft was awarded a $22 billion contract to provide the military with virtual reality headsets for training.

In January, it also paid Tesla stock options for $1 million, just before President Joe Biden announced an incentive program for electric vehicle manufacturers.

However, Nancy Pelosi’s press team, when asked by Fox Business about her husband’s financial moves, stated that “the speaker has no prior knowledge of these transactions” and added that “the speaker does not own any stock.”

Although like any investor, Paul Pelosi invests to obtain returns on his investment, the timing of his investments is surprising, especially considering his wife’s role in Congress and in the Democratic Party.

Economist, writer and liberal. With a focus on finance, the war on drugs, history, and geopolitics // Economista, escritor y liberal. Con enfoque en finanzas, guerra contra las drogas, historia y geopolítica

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