;-):>>>Senators Like Tech Stocks...
High-Tech Investments Lure Some Senators, Too
washingtonpost.com
By Matthew Vita and Susan Schmidt
Washington Post Staff Writers
Thursday , June 15, 2000 ; A01
Sen. Robert G. Torricelli (D-N.J.) has become an active stock trader, buying and selling dozens of securities, including highflying technology companies and potentially lucrative IPOs, in a vivid illustration of a growing turn toward Wall Street investments by members of the Senate, financial disclosure statements revealed yesterday.
Among Torricelli's holdings is a giant telecommunications company that would benefit from legislative language he is sponsoring. Torricelli owns stock in Global Crossing, a telecommunications company that is involved in a pitched battle on Capitol Hill over disputed radio spectrum worth billions of dollars. Torricelli has been seeking to aid NextWave, a bankrupt wireless company in which Global Crossing has invested heavily.
The 1999 financial disclosure statements indicate that many members of the Senate, like Americans generally, have watched their portfolios swell courtesy of the stock market's boom. With fancy gifts and fees for outside speeches banned over the last decade, many senators must now rely almost entirely on their $136,000 annual salaries--and many are looking to the market to bolster their income.
And at a time when Congress is focused on a host of issues relating to the new technology-driven economy, a number of senators have substantial investments in high-tech firms, the statements show. At least 11 senators owned stock in Microsoft Corp., for example; 14 senators were invested in America Online Inc., 16 owned Lucent Technologies Inc. stock and 13 owned Cisco Systems Inc. shares.
Ethics experts said yesterday there is nothing illegal about members of Congress investing in the market. But the buying and selling of stocks could lead many lawmakers down a murky path as they vote on legislation that potentially affects companies they own--and their investments.
The roaring market boosted the portfolios of big stockholders such as Sen. Chuck Hagel (R-Neb.), who had an account with Merrill Lynch (with his wife) worth $2.9 million and another with the McCarthy Group of Omaha worth $8.8 million. It also lured at least one newcomer into the market, as Sen. Paul S. Sarbanes (D-Md.) made his first stock investment by putting $15,001 to $50,000 into a mutual fund.
A few senators did manage to avoid the market's temptations. Sen. James M. Jeffords (R-Vt.) listed two savings accounts totaling between $2,000 and $30,000--but no stocks or mutual funds. Sen. Robert C. Byrd (D-W.Va.) had all of his money in Treasury bills, bank accounts and money market funds.
Among the Senate's active stock traders, Torricelli was rivaled only by Hagel. The New Jersey Democrat made 112 stock transactions in 1999, some on a one-day turnaround--a dramatic increase from his stock trading of the previous year. His stock holdings were valued at between $260,000 and $775,000, and included 20 high-tech companies and a handful of initial public offerings.
As chief fundraiser for Senate Democrats this election, Torricelli has sought to bring new high-tech firms flush with money under the Democratic tent.
"He is an active participant in the high-tech market, and he does so without apology," said Abbe Lowell, Torricelli's attorney. "Sometimes he does well, sometimes less well."
Among the companies Torricelli has invested in are Tyco International, a maker of undersea cable; ZixIt, which specializes in encryption technology; E-Cruiter.com, a Web-based recruiting firm; and Comp USA, a computer retailer. Most of his investments were in the $15,000 to $50,000 range. (The Senate financial disclosure forms allow senators to list their holdings in broad monetary ranges.)
Torricelli invested $15,000 to $50,000 in Global Crossing in May 1999, and sold an undetermined amount of it later in the year. But he retained holdings in the $15,000 to $50,000 range at the end of last year.
This spring, Torricelli has been a prime mover in the Senate to aid NextWave, a wireless company that Global Crossing is helping to reorganize its finances. NextWave filed for bankruptcy after winning the right to buy $4.7 billion in spectrum from the Federal Communications Commission. The FCC wants to reclaim the licenses--which have since doubled in value--a move supported by other telecommunications companies that would like to bid on them. Torricelli tried unsuccessfully to get language added to a bankruptcy bill that would have prevented the FCC from taking back the licenses for reauction.
Torricelli spokesman Richard McGrath said the senator's actions on behalf of NextWave were unrelated to his stock investments. "Global Crossing has never contacted Senator Torricelli concerning its investment in NextWave, and the senator has been unaware of Global Crossing's interest in NextWave," McGrath said.
The Senate continues to have its share of multimillionaires, the financial statements show. Sen. John D. "Jay" Rockefeller IV (D-W.Va.) listed three blind trusts that alone were worth at least $80 million. Sen. Peter Fitzgerald (R-Ill.) listed Bank of Montreal stock valued at between $25 million and $50 million. He inherited the stock from his father.
But while last year's financial reports do nothing to belie the Senate's image as a rich man's club, the chamber does have its share of members of more modest means.
Sen. Joseph R. Biden Jr. (D-Del.), for example, listed as assets two credit union accounts worth less than $1,000 and several debts, including at least $15,000 owed to Mastercard. Sen. Ron Wyden (D-Ore.) held $1,000 to $15,000 in a Senate credit union account.
Some of the disclosure reports stood out for reasons other than the stock market. Sen. John Breaux (D-La.) won $5,625 in prize money for his showing in a doubles match last August in the 15th annual Huggy Bears invitational charity tennis tournament on Long Island.
Sen. Kay Bailey Hutchison (R-Tex.) earned $241.68 in royalties for her cameo appearance on the network television series "Walker, Texas Ranger," while Sen. Edward M. Kennedy (D-Mass.) received $16,500 for his regular appearances on the "Face Off" radio program. Both donated the money to charity.
Judiciary Committee Chairman Orrin G. Hatch (R-Utah)--whose campaign biography says he has written lyrics for hundreds of songs and produced or co-produced seven compact discs, focusing on family, faith and love of country--reported composing income of $6,125 from Prime Recordings Inc. of Provo, Utah, and royalties of $12,048, including $500 from MTV and $395 from the Citizens Flag Alliance, of Indianapolis.
Among Washington area senators, Sen. Charles S. Robb (D-Va.) remained the wealthiest, with assets worth at least $9 million. His family holdings include two blind trusts each worth at least $1 million belonging to his wife, Lynda Johnson Robb, a daughter of the late President Lyndon B. Johnson, and to the couple's three daughters.
Robb's family received $1.1 million to $5.2 million through the liquidation last year of two Texas-based Johnson family partnerships with oil, gas and real estate interests. A Robb aide said the transactions were begun several years ago and are unrelated to his costly reelection battle this fall against a well-funded challenger, former Virginia governor George Allen (R).
Sen. John W. Warner (R-Va.) received a 90-day extension from the Select Committee on Ethics for his report, which was due May 15.
Sen. Barbara A. Mikulski (D-Md.) reported assets of $188,000 to $707,000, mostly in mutual funds and savings, and $8,252 in royalties from her novel, "Capitol Offense."
Staff writers George Lardner Jr., Mike Allen and Spencer S. Hsu and staff researchers Alice Crites and Richard Drezen contributed to this report.
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