Sen. Richard Burr under investigation, possibly for breaking law passed following 60 Minutes report

Burr is under investigation for selling stock prior to the economic downturn caused by the COVID-19 pandemic.

Congress: Trading stock on inside information

Senator Richard Burr, a Republican from North Carolina, is temporarily stepping down as Chairman of the Senate Intelligence Committee as federal investigators look into timely stock sales he and his wife made around the same time Congress began receiving briefings on the effects COVID-19 could have on the country. 

On Wednesday, agents from the Federal Bureau of Investigation seized a cellphone belonging to Burr from his home. A senior official from the Department of Justice tells CBS News the warrant was served on Burr's attorney and the cellphone was picked up from Burr's residence. There was no raid to recover the device. 

In a statement released Thursday, Burr said, "This morning, I informed Majority Leader McConnell that I have made the decision to step aside as Chairman of the Senate Intelligence Committee until this investigation is resolved. The work the Intelligence Committee and its members do is too important to risk hindering in any way. I believe this step is necessary to allow the Committee to continue its essential work free of external distractions."

Senate financial disclosure records reveal Burr and his wife made at least 30 stock sales in from January 31 to February 13 of this year ranging from $600,000 to $1.7 million. They also purchased between $16,000 and $65,000 of stock in a pair of trades on February 4. The senator issued a statement on March 20 that he "solely relied on public news reports" out of China when he decided to sell stock on February 13. Burr also requested the Senate Ethics Committee review the matter and said he would fully comply.

A "senators only" closed-door briefing was held on January 24 about the threat COVID-19 posed to the U.S. Senator Burr's office would not confirm whether he attended. On March 11, the World Health Organization labeled the COVID-19 outbreak a pandemic. 

The Dow Jones Industrial Average reported seven straight days of losses from February 20 when the market opened at 29,296 to February 28 when it closed at 25,409, loses totaling more than 3,800 points.

The sold stock may be more than a political firestorm—it may also be illegal. A law called the Stop Trading on Congressional Knowledge (STOCK) Act prohibits lawmakers from using non-public information, obtained through their government work, to buy or sell stock, and it came about because of a 60 Minutes investigation. 

In November 2011, correspondent Steve Kroft reported that some members of Congress had made significant personal financial maneuvers in the lead-up to the 2008 financial crisis and the 2009 passing of the Affordable Healthcare Act. The 60 Minutes investigation also found elected officials were exempt from insider trading laws and given unique access to initial public offerings. 

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In 2011, Peter Schweizer was a fellow at the Hoover Institution, a conservative think tank at Stanford University. He was one of the first to uncover the loophole in the law. 

"We know that during the health care debate, people were trading health care stock," Schweizer told 60 Minutes in 2011. "We know that during the financial crisis of 2008, they were getting out of the market before the rest of America really knew what was going on."

Kroft's report pressured Congress to respond. Five months later, they passed the STOCK Act. The law created a digital database of financial disclosure forms by members of congress and their spouses. President Barak Obama signed an amendment to the law in 2013, eliminating congressional staff members from having to disclose their financial transactions on the online portal.

The 2012 bill passed the House of Representatives by a vote of 417-2 and the Senate by a tally of 96-3. Burr was one of the three senators who voted against the measure. 

At the time, the North Carolina senator said he opposed the STOCK Act because it "would codify what existing law already says." In 2012, Burr said insider trading laws that "apply to the American people also apply to members of Congress and their staff."

APTOPIX Trump Russia Probe
Sen. Richard Burr, R-N.C., in 2018. J. Scott Applewhite / AP

60 Minutes contacted both Burr's senate office and outside counsel at Latham & Watkins to find out who manages the senator's assets and why he sold such a large sum of stock in a two-week period. His lawyer, Alice Fisher provided us the following statement in April: 

"The law is clear that any American – including a Senator – may participate in the stock market based on public information, as Senator Burr did. When this issue arose, Senator Burr immediately asked the Senate Ethics Committee to conduct a complete review, and he will cooperate with that review as well as any other appropriate inquiry. Senator Burr welcomes a thorough review of the facts in this matter, which will establish that his actions were appropriate."

As chairman of the Senate Intelligence Committee, Burr was privy to some of the nation's most secret information. 

The January 24, closed-door briefing was open to all senators and hosted by the Senate Foreign Relations Committee and the Health, Education, Labor and Pensions (HELP) Committee, the latter of which Burr is a member. The briefing took place in the middle of President Trump's impeachment trial.

Among the physicians who briefed senators were Dr. Anthony Fauci from the National Institute of Allergy and Infectious Disease and Dr. Robert Redfield, Director of the Centers for Disease Control and Prevention.

Coronavirus Briefing
Dr. Anthony Fauci, head of the National Institute of Allergy and Infectious Diseases, talks to reporters before the start of a closed all-senators briefing on the coronavirus on Capitol Hill in Washington, Friday, Jan. 24, 2020. Susan Walsh / AP

Following the briefing in the Dirksen senate office building, Dr. Fauci told waiting reporters, including CBS News: "The risk for the American public is very low, but it's still something that as health authorities we take very, very seriously."

Fauci said there were "a little more than 800 cases and 26 deaths" being reported by the Chinese government.

 "Obviously we are taking this very seriously," said Fauci. "I don't think this is something the United States public should be worried or frightened about, but they should know that we are taking this obviously very seriously as it evolves."

A Senate HELP committee aide told 60 Minutes that after its initial January 24 COVID-19 briefing, the committee hosted briefings on February 5, February 12, February 25, and March 12 that were open to all senators. Attendance was not taken. 

Of the five senate HELP committee briefings on COVID-19, only the February 25 briefing was held in a classified setting. A committee spokesperson told 60 Minutes, at the conclusion of the briefing the participating senators agreed no classified material was discussed. 

A source tells 60 Minutes, Senator Burr was present for the briefings on February 5 and 12. The Senator's office declined to comment. 

The WHO declared the COVID-19 outbreak a Public Health Emergency on January 30. A day later, the Secretary of Health and Human Services, Alex Azar, declared a public health emergency for the U.S. 

The WHO declared the Coronavirus a pandemic on March 11. At the time, there were more than 118,000 confirmed cases of COVID-19 across 114 countries.

On February 27, Burr gave a speech to a private audience where he warned Coronavirus posed a threat to the U.S. In audio obtained by National Public Radio, Burr is heard warning of potential travel disruptions and school closures. On March 11, the White House issued a European travel ban. 

According to a committee spokesperson, the Trump administration did not consult the senate HELP committee before announcing the travel ban.  

Prior to the pandemic, Burr took a leadership role in creating legislation to prepare the country for the possibility of a pandemic or bioterrorism event. In June 2019, the senate unanimously passed the Pandemic and All-Hazards Preparedness and Advancing Innovation Act, a bill sponsored by Burr. It marked the third time since 2006 that Burr sponsored a pandemic preparedness bill that became law. 

In 2016, the 64-year-old announced his plan to retire in 2022 at the conclusion of his third term in the senate. 

The Los Angeles Times first reported the seizure of Burr's phone. 

Andres Triay and Clare Hymes contributed to this reporting.