George W. Bush's Stock Sale

[Rooster71]

I have noticed that several posters in this topic are unaware of Bush's dealings in Harkin Energy. So maybe the following article will inform those who are unaware of these past Bush dealings.

Published on Saturday, March 13, 2004 by the Brattleboro Reformer (Vermont)
Little Martha and Big George by Stephen F Minkin

On March 6, 2004, the New York Times published an editorial entitled “Courtroom Tales of Martha’s Lies…”. It states that her persecution “was not about unfairly targeting a celebrity defendant but about enforcing the transparency of the financial markets.” The Times also commented on how “the trial depicted a cozy world where insiders routinely use their wealth and connections to benefit from insider information.”

Isn’t that the American way? In June 1990, George W. Bush sold 200,000 shares of Harkin Energy stocks while he sat on the oil company’s board as a member of its audit committee. He unloaded his shares before the price plummeted and while outside investors were unaware of the company’s desperate situation. Mr. Bush later blamed his lawyers and the “loss of documents” by the Securities and Exchange Commission when it was discovered that he failed to disclose the $848,560 sale within the time required by law. He used most of the proceeds to pay off a loan he had taken out the previous year to buy a partnership interest in the Texas Rangers baseball team. The SEC, suspicious about the timing of these events, opened and then abruptly closed its investigation. A letter to his lawyers informed the future president that the decision to end the investigation should “in no way be construed” as exonerating him. George Bush Sr. was then president while the SEC Chairman was a family friend and sometime legal advisor.

Martha Stewart was convicted of an attempted cover-up. She had taken for granted the fact that American aristocrats now and then bend the rules governing insider-trading. Her crime, however, pales in comparison with what we already know about the President’s and his Vice President’s abuses of privilege for self protection and the pursuit of wealth. Mr. Cheney ran the Halliburton Corporation when the company reportedly bribed Nigerian officials for lucrative oil-related contracts. He continues to hide the minutes of the so-called “Energy Taskforce”, a convocation of plugged in, insiders who have chosen to remain anonymous.

It will be interesting to see if John Kerry and the media challenge Mr. Bush on Martha Stewart. Will they ask him to spell out how his activities at Harkin Energy differ legally and ethically from the insider-trading and attempted cover-up by the queen of image and good taste. Ms Stewart, according to the findings of a jury, attempted to conceal the truth about dumping ImClone stocks following an illegal tip from her broker that the president of the company was dumping his shares. If Mr. Bush as a board member knew the precarious nature of Harkin’s finances when he sold his shares, he would be guilty of defrauding clueless investors.

Ms. Stewart’s misfortunes are focusing attention on insider-trading. This may help shed light on the murky abuses of those who are not only rich and famous but also truly powerful. It is clear that the President, an insider, profited from the sale of his Harkin shares while outsiders who invested in the company lost millions of dollars. Even a Dick Cheney cannot hide these well known facts.

The burning question is, was George W. Bush also able to use the full force and power of the SEC chairman and/or his father’s presidency to save his own neck from prosecution? It is time for the SEC to release all documents pertaining to the agency’s decision to end the investigation of what the President knew before he unloaded his Harkin Energy shares. Otherwise we are left with a nearly palpable impression that, compared to the cover-up of the President’s insider-trading, Martha Stewart’s misdeeds are really small change.

[Patrick del Poker Grande]

We've seen Fahrenheit/911.

[Rooster71]

[ QUOTE ]
We've seen Fahrenheit/911.

[/ QUOTE ]
I haven't seen it. But thanks for letting me know that you have. I really appreciate the info.

[adios]

[ QUOTE ]
In June 1990, George W. Bush sold 200,000 shares of Harkin Energy stocks while he sat on the oil company’s board as a member of its audit committee. He unloaded his shares before the price plummeted and while outside investors were unaware of the company’s desperate situation.

[/ QUOTE ]

This came up in another thread where I explained that his announced intention to sell was what the market keys on and his announcement that he was going to sell was well within the laws. The markets get their queue from the announcement to sell. The markets don't wait for 2 weeks after an announced sale to get get their queue on what an insider sales means. He announced that he was going to sell but didn't actually complete the report that he had completed the sale within the two week time frame required. The two week period I believe is right for the time period as I'm working from memory. I know you won't be convinced so I won't even try, I'll just refer you to the other thread if you care to search for it.

[cardcounter0]

Obviously Georgie could hold up a liquor store with a gun and that would be okay with a certain segment of the population because he was just exercising his 2nd Admendment rights.

A Conservative Washington Think-Tank would then come out with a study supporting the armed robbery, pointing out that the liquor store sold a lot of white wine, and as we know, only gay liberals drink that foo-foo white wine stuff.

[Rooster71]

[ QUOTE ]
[ QUOTE ]
In June 1990, George W. Bush sold 200,000 shares of Harkin Energy stocks while he sat on the oil company’s board as a member of its audit committee. He unloaded his shares before the price plummeted and while outside investors were unaware of the company’s desperate situation.

[/ QUOTE ]

This came up in another thread where I explained that his announced intention to sell was what the market keys on and his announcement that he was going to sell was well within the laws. The markets get their queue from the announcement to sell. The markets don't wait for 2 weeks after an announced sale to get get their queue on what an insider sales means. He announced that he was going to sell but didn't actually complete the report that he had completed the sale within the two week time frame required. The two week period I believe is right for the time period as I'm working from memory. I know you won't be convinced so I won't even try, I'll just refer you to the other thread if you care to search for it.

[/ QUOTE ]
So you're saying that he used his insider knowledge (he was on the audit committee) and legally announced his intention to sell. After he legally announced his intentions, the price miraculously held up until he sold his shares. Then only after he sold his shares, the price plummeted. Is this what you're saying?

"The markets get their queue from the announcement to sell." The markets also get their queue from financial information, which Bush had, but common investors didn't have.

[Rooster71]

[ QUOTE ]
Obviously Georgie could hold up a liquor store with a gun and that would be okay with a certain segment of the population because he was just exercising his 2nd Admendment rights.

A Conservative Washington Think-Tank would then come out with a study supporting the armed robbery, pointing out that the liquor store sold a lot of white wine, and as we know, only gay liberals drink that foo-foo white wine stuff.

[/ QUOTE ]
Then Limbaugh, Hannity and the rest of the conservative talking heads would tell everyone that if you are against Georgie holding up a liquor store you are unpatriotic un-American and full of hate towards conservatives and their "values".

[Utah]

Interesting post and it looks suspicious. However, it doesnt show he is guilty of anything.

People on boards sell stock all the time and the stock falls afterwards. The fact that he used the sale to pay off a loan tends to make one think the sale was neccessary. To show insider trading, you need to show that he had information that the public or investors did not. The case you presented in its current form is more guilt by association.

I am not saying he is not guilty. However, a stronger case needs to be built.

btw - almost everyone would sell their stock if they knew it was going to crash. You wont? I am not saying it is right. I am just saying everyone does it.

Also note, Martha Stewart was not charged or convicted on any trading violation and she might not even have broken the law in regards to the trade if it happened as the government said.

[adios]

[ QUOTE ]
So you're saying that he used his insider knowledge (he was on the audit committee) and legally announced his intention to sell.

[/ QUOTE ]

Yep.

[ QUOTE ]
After he legally announced his intentions, the price miraculously held up until he sold his shares.

[/ QUOTE ]

I wouldn't call it miraculous why should it be. The stock tanked months later.

[ QUOTE ]
Then only after he sold his shares, the price plummeted. Is this what you're saying?

[/ QUOTE ]

Yep, so what?

[ QUOTE ]
The markets also get their queue from financial information, which Bush had, but common investors didn't have.

[/ QUOTE ]

Do you know what a 10-Q is? As far as I know Harken filed all the 10-Q's and 10-K's required. There's was no specific financial information required in filing the paperwork announcing the sale.

What I suggested in the other thread was going back to the Harken 10-Q's from the period (they should be available at Edgar.com) and review the financial statements of Harken to make a case that they defrauded investors with misleading information. You ought to try it, it should be a learning experience for you. Sarbanes-Oxley was not the law then so criminal culpability probably doesn't exist. I don't know what's in the 10-Q's but as far as the market getting their queue's from the announcement I'm right.

[Utah]

You are not full of hate towards conservatives and their values?

[Rooster71]

[ QUOTE ]
You are not full of hate towards conservatives and their values?

[/ QUOTE ]
No, I'm not. But I am full of hate towards liars and hypocrites. And for the most part, I don't see that conservatives have that many values.

Are you full of hate towards liberals and their values?

[Rooster71]

[ QUOTE ]
Interesting post and it looks suspicious. However, it doesnt show he is guilty of anything.

People on boards sell stock all the time and the stock falls afterwards. The fact that he used the sale to pay off a loan tends to make one think the sale was neccessary. To show insider trading, you need to show that he had information that the public or investors did not. The case you presented in its current form is more guilt by association.

I am not saying he is not guilty. However, a stronger case needs to be built.

btw - almost everyone would sell their stock if they knew it was going to crash. You wont? I am not saying it is right. I am just saying everyone does it.

Also note, Martha Stewart was not charged or convicted on any trading violation and she might not even have broken the law in regards to the trade if it happened as the government said.

[/ QUOTE ]
Bush's Harken Energy deal looks suspicious all the way around. If nothing else, the fact that any investigation was dropped looks to be the most suspicious fact.

[Utah]

"Bush's Harken Energy deal looks suspicious all the way around. If nothing else, the fact that any investigation was dropped looks to be the most suspicious fact."

Maybe it was dropped because there was nothing there? Suspicious is a very far cry from guilty. It is wrong to draw the conclusion that he did anything wrong without more information. In fact, if innocent, he did nothing that even gives the appearance of impropriety (i.e., he didnt do anything that he should have known would look bad).

The basic facts -

1)he sold stock on a board that he was a part of - a very common practice for board members
2) The stock soon dropped - a very common occurance
3) The SEC investigated - a very common occurance given 1 and 2 combined
4) The SEC dropped the investigation but said it wasnt exonerating him. Very common too
5) His dad was president

Where is the meat to this? To make a case you need evidence. e.g. a memo pressuring the SEC to drop, an email showing the Bush knew the stock was going to drop, etc.

There is absolutely nothing here to draw any conclusion.

Is there more to this story?

[cardcounter0]

A nine-page memo, dated June 15, 1990 and titled, “Liability for Insider Trading and Short-Term Swing Profits,” was sent to the board of directors by Harken’s lawyers from Haynes and Boone law firm. It explained that the board faced the risk of being suspected of insider trading if they sold their shares at that time. The basis for this conclusion was that Harken board members arguably knew more about Harken’s financial problems the general public. The memo stated, “If the insiders presently possess any material non-public information, particularly any unfavorable information, a sale of any of their shares could be viewed critically if the market price of Harken’s common stock should decline in response to additional disclosures regarding the proposed rights offering.” While White House spokesperson Bartlett contended that the memo “was not specific to the transaction that the president was contemplating,” the Boston Globe reported, “SEC reports on the case make it clear, however, that the memo was written in response to Bush asking Harken executives whether he could sell his shares.” The memo was not obtained by the SEC until the day after the investigation came to a close.

Also, if Bush had sold his shares in the open market the price would have dropped on such a large block sale because the stock was thinly traded. But a private arrangement was made for a large instituitional buyer to buy Georgie's shares. The private institution and ultimate loser in the deal? Harvard University Trust Fund. George Sr. sat on the board of directors and approved the investment.
/images/graemlins/wink.gif

[Wake up CALL]

[ QUOTE ]
Are you full of hate towards liberals and their values?

[/ QUOTE ]

Why, yes, now that you mention it I am.

[superleeds]

Hardly anyone in America is aware due to the liberal media's silence on this story. Contrast this with the $hit they gave Clinton over Whitewater.

[Boris]

You forget one basic fact in your list of basic facts. That fact is the fact that Harkin's stock plummeted as the result of adverse financial performance for the period in which Bush liquidated.

Another basic fact that should be mentioned is that nowadays it is common practice among company insiders to announce a schedule of stock sales in well in advance of when they actually sell. So for example a high level executive or board member will send a letter to the SEC say he is going to sell X number of shares on the fifth business day of every quarter for the next 4 quarters. This is the ethical thing to do. Maybe it wasn't the practice in 1990 or maybe that's not how they do business in Texas. I don't know. I do know that this issue of insiders selling stock and possible conflicts of interest has been around for a very long time. I also know that there are mechanisms to avoid even the appearance of impropriety. So when Bush says it was a just a mistake and yet he profited mightily, I have a hard time believing that.

[Rooster71]

[ QUOTE ]
Hardly anyone in America is aware due to the liberal media's silence on this story. Contrast this with the $hit they gave Clinton over Whitewater.

[/ QUOTE ]
How true! Also, remember the "Whitewater Scandal?" Clinton's involvement in that (if any) was a molehill when compared to the questionable Bush business dealings.

[Utah]

You forget one basic fact in your list of basic facts. That fact is the fact that Harkin's stock plummeted as the result of adverse financial performance for the period in which Bush liquidated.
Although its implied from my list, its irrelevant unless there is evidence that he had information that the investment community did not and that he used that info to sell his stock.

Maybe it wasn't the practice in 1990
it was the practice in the fortune 500 company I worked at in 1997. I dont know what was standard at the time though.

I have a hard time believing that
Why? I dont understand this. There is zero evidence that he did anything improper.

[Rooster71]

"Bush's Harken Energy deal looks suspicious all the way around. If nothing else, the fact that any investigation was dropped looks to be the most suspicious fact."

Maybe it was dropped because there was nothing there? Or maybe not. Suspicious is a very far cry from guilty. True, but how would there be any evidence to point toward guilt when the issue was dropped? It is wrong to draw the conclusion that he did anything wrong without more information.Does "more information" mean a signed confession? In fact, if innocent, he did nothing that even gives the appearance of impropriety (i.e., he didnt do anything that he should have known would look bad).Wrong again

The basic facts -

1)he sold stock on a board that he was a part of - a very common practice for board members
2) The stock soon dropped - a very common occurance
3) The SEC investigated - a very common occurance given 1 and 2 combined
4) The SEC dropped the investigation but said it wasnt exonerating him. Very common too
5) His dad was president

Where is the meat to this? To make a case you need evidence. e.g. a memo pressuring the SEC to drop, an email showing the Bush knew the stock was going to drop, etc. Since there was no complete and thorough investigation (and never will be) this type of evidence will probably never surface. As far as your examples, I seriously doubt that the elder George would put anything in writing asking the SEC to drop. And George W. would have to have known that the stock would drop. First of all, any sale (of that size) of a lightly traded small cap stock will cause a price drop. Second, we're talking about a 75% drop, not a minor price tick. This large drop was caused by the results of the audit being made public. And again Georgie was on the audit committee.

There is absolutely nothing here to draw any conclusion.

Is there more to this story?
I'm sure there's alot more to this story. I just wish the media would pursue it just as they did with Clinton's Whitewater deal (among other Clinton "scandals").

[paland]

[ QUOTE ]
You are not full of hate towards conservatives and their values?

[/ QUOTE ]
I am. i hate them motherf...rs

[Rooster71]

[ QUOTE ]
You forget one basic fact in your list of basic facts. That fact is the fact that Harkin's stock plummeted as the result of adverse financial performance for the period in which Bush liquidated.
Although its implied from my list, its irrelevant unless there is evidence that he had information that the investment community did not and that he used that info to sell his stock.

[/ QUOTE ]
He was on the audit committee that came up with reports showing the poor performance of the company. That is the evidence that he had information that the investment community did not have. Was this information his basis for making the sale? I believe it probably was, but this is something that is very difficult to prove. Anything short of a letter (or voice message) stating that "I am going to sell my holdings in Harken Energy because I know information that the public does not know. This information is bad and I want to sell before the information becomes public and the price plummets" does not establish the reason for selling.

He filed the necessary SEC reports regarding his sale, albeit they were late filings. If I remember correctly, his excuse was "lost paperwork" and "SEC error." I don't buy the story, it's just too weak.

Pro-Bush folks will say that nothing was ever proven. Well when your daddy is the president not many facts are going to be proven or even thoroughly investigated.

[caretaker1]

"If Mr. Bush as a board member knew the precarious nature of Harkin’s finances when he sold his shares, he would be guilty of defrauding clueless investors."

Actually, that was Bill Clinton's fault too.

[jokerswild]

Conservatives remind me of my old German professor who insisted that the German people didn't know what Hitler did to the Jews. It's totally asinine. I guess the authoritarian personality bent sheep can't help but deny any culpability in the support of an atrocious leader. They can't handle the cognitive dissonance.