Online Casino Foe Spencer Bachus Linked to Suspicious Trading

Representative Spencer Bachus has railed at supporters of online gambling regulation and individual freedom, complaining of what he saw as a lack of morals and ethics by his opponents, yet now it has come to light that Bachus has made many short-term investments whose profitability lay in the hands of pronouncements from Congress and the Financial Services Committee, of which he is a leading member.

While many members of Congress hold long-term positions in the market, daytrading on stocks directly affected by Congress is considered both unusual and inappropriate, if not illegal.

The Associated Press has documented a plethora of trades by the Alabama Republican in which he bought and quickly sold shares in companies receiving a quick jolt by a news disclosure. Some of these trades were made in less than a week.

Bachus has the ability to change market outlooks just by making statements from his position on the committee. While Bachus himself refused to answer questions from the AP, his spokesman said he had never invested in a banking or financial firm. The spokesman also specified that Bachus had been careful to stay within legal limits placed on trading by Congressional ethics laws

Still, Bachus' deals reek of the stuff ethics laws  are written for; not only does he have knowledge of news that affects the market before its public release, but he can spin and control the release to have differing results for stock movement.

Bachus' trades have been revealed to largely be puts or calls, these being short-term margin purchases in which speculators expect a quick stock adjustment up or down, the essential insider trade bid.

Bachus bought shares of the Chinese company Focus Media last December, then two weeks later sold off the stock immediately following a price jump that was caused by a press release concerning a corporate acquisition. He also held Reserach in Motion shares for two weeks, selling for a profit after the company successfully lobbied Congress for patent protections.

James Cox, a law professor at Duke specializing in corporate law and the ramifications of insider training, said the situation was unacceptable. "We get very upset about baseball players and other sports players who gamble ... because we're worried about the temptation that they might bet on their own games. I think this is the same problem."

Bachus worries constantly about protecting American families from unscrupulous Internet gaming sites, despite denying the regulation that would provide easy protection for all Americans.

But who is to protect citizens from unscrupulous Congressmen, eager to gain from their insider knowledge and betray their sacred trust to manipulate the market? Isn't this exactly the kind of situation that calls for a formal investigation from an independent counsel?

It looks likely that Spencer Bachus could be the next Charles Keating, the moralistic anti-pornographer who persecuted Larry Flynt until he was revealed to have bilked millions in his role in the savings and loan scandal. Never trust the self-proclaimed unimpeachable, sinless protectors of public morality; they are always the ones with the greatest sins hidden away.