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Appointed Georgia Sen. Loeffler Under Fire For Stock Sales In Weeks Before Pandemic


A new U.S. senator from Georgia has come under fire for selling $20 million worth of stocks in the weeks leading up to the declared coronavirus pandemic. Republican Kelly Loeffler was appointed to a seat left vacant when the previous senator retired, and the appointment went against President Trump's wishes. Now just three months in, Loeffler is fighting for her political life ahead of the November election. NPR congressional reporter Claudia Grisales has more.

CLAUDIA GRISALES, BYLINE: When Georgia's Republican governor appointed Kelly Loeffler to a vacant Senate seat, it marked a fiery entrance into politics. President Trump and his allies had lobbied heavily for Congressman Doug Collins to get the seat instead. Here's Gov. Brian Kemp making the news in December.


BRIAN KEMP: Ladies and gentlemen, please join me in welcoming our next U.S. senator, Kelly Loeffler.

GRISALES: The wealthy Georgia businesswoman had a compelling story. She grew up on a successful Illinois farm and was drawn into the world of trading. Eventually, she worked in the financial services industry as a chief executive. Analysts say Kemp picked Loeffler to bridge the growing divide in his state between Trump supporters and suburban female voters looking for an alternative. Loeffler has since proven to be a vocal supporter of the president, especially during his Senate impeachment trial. But even early on, she acknowledged she was a political neophyte facing an uphill battle ahead.


KELLY LOEFFLER: I know I have a lot of work to do to earn the trust and support of my fellow Georgians.

GRISALES: Just a few months later, that trust and support hang in the balance. Loeffler is part of a group of senators, both Democrat and Republican, whose recent stock transactions are under new scrutiny. Loeffler and her husband, who is the CEO of a company that owns the New York Stock Exchange, dumped millions of dollars in shares after she attended a closed-door Senate briefing on the coronavirus virus in January. The couple also picked up investments in companies that have benefited in the pandemic. The details were shared as part of a 2012 law called the STOCK Act. Political science professor Andra Gillespie at Emory University says the timing couldn't be worse.

ANDRA GILLESPIE: And so the stories that have come out about her stock trade, you know, are things that put her on the defensive at a time where she's trying to introduce herself and where she's trying to have a honeymoon period.

GRISALES: The STOCK Act stands for Stop Trading on Congressional Knowledge. Columbia University law professor John Coffee explains Congress approved the law in the wake of studies showing that lawmakers financially benefited from their government work.

JOHN COFFEE: Congressmen were receiving extraordinarily high returns, better than any hedge fund.

GRISALES: Loeffler has vigorously defended herself in a round of interviews. She said the trades were made without the couple's knowledge because they use a blind trust, and a third party handles their transactions. Here's Loeffler on Bloomberg News.


LOEFFLER: I have no involvement with the investment activities conducted by third-party advisers.

GRISALES: Recently, she announced she and her husband would divest themselves from their stock investments in an effort to put the criticism to rest. But the developments have given opponents like Collins, who is running against her as well as her Democratic rivals, new ammunition. The stakes couldn't be higher. Experts say that Georgia could be a key state later this year, when the elections determine if Republicans or Democrats control the Senate. Here's Professor Gillespie again.

GILLESPIE: This is a place that was once a Republican stronghold that now has become incredibly competitive.

GRISALES: For Loeffler, that means the coming weeks and months will be critical for her and her party's political fortunes.

Claudia Grisales, NPR News, Washington.

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Claudia Grisales
Claudia Grisales is a congressional correspondent assigned to NPR's Washington Desk.