A group of federal lawmakers, including Massachusetts Sen. Elizabeth Warren, sent a letter to Securities & Exchange Commission Chair Gary Gensler asking him to open an investigation into potential insider trading by UnitedHealth Group executives.
The April 29 letter came after Bloomberg reported that UnitedHealth Group's chairman and three of the company's executives earned a combined $101.5 million from stock sales made over a four-month period leading up to the public becoming aware of a Justice Department antitrust investigation.
The stock sales occurred between Oct. 16 — the week after the company reportedly received notice of the Justice Department's investigation — and Feb. 26, the day Bloomberg, The Wall Street Journal and other outlets reported on the investigation. Shares fell 5.2% in two trading sessions on Feb. 27 and Feb. 28 after the investigation was widely reported.
Neither UnitedHealth Group nor the Justice Department have publicly acknowledged the reported antitrust investigation.
The lawmakers are asking the SEC to conduct a review of several questions, including:
- Was the existence of a Justice Department investigation of UnitedHealth a materially important matter, and if so, was it appropriately disclosed by company officials?
- Which individuals were involved in stock trades between the time that the company became aware of the investigation and the time the investigation became public?
- Were these trades made by individuals who had access to material, nonpublic information, and if so, did these trades represent a violation of insider trading law?
- Were the planned trades disclosed to and approved by appropriate individuals at UnitedHealth?