WASHINGTON – Senator Richard M. Burr of North Carolina temporarily stepped down as president of the Senate Intelligence Committee on Thursday, a day after FBI agents seized his cell phone as part of an investigation to find out if he sold hundreds of thousands of dollars worth of stock using non-public information about the coronavirus.
The seizure and a search of their electronic storage accounts, confirmed by an investigator informed of the case, represented a significant escalation of the investigation by the Department of Justice and the Securities and Exchange Commission. They suggest that Burr, a Republican and one of the most influential members of Congress, may be taking serious legal risks.
Given the sensitivity surrounding the decision to obtain a search warrant against an incumbent senator, the measure was passed at the highest levels of the department, said a senior Justice Department official, meaning that Attorney General William P. Barr signed. The warrant for Burr’s phone number was handed over to his lawyer, and investigators took Burr’s phone from him at his home, according to the officer who, like the investigator, spoke on condition of anonymity to publicly discuss the case.
Burr denied that he did anything wrong. With the investigation underway, he said on Thursday that he wanted to limit the distraction to the Senate and informed Senator Mitch McConnell, a Kentucky Republican and majority leader, that he would step down. Burr will remain a member of the committee, however, and will continue to serve in the Senate.
“This is a distraction from the committee’s hard work, and the members and I think the security of the country is too important to be distracted,” Burr told reporters on Capitol Hill. He declined to discuss the case further, but said he was cooperating with the authorities.
Mr. McConnell, who has not yet chosen a temporary successor for Mr. Burr as chairman, said that he agreed that “this decision would be in the committee’s best interest and will take effect at the end of tomorrow.”
Burr sold the shares on February 12, before the market burst and how President Trump and some supporters minimized the threat of the virus. At the time, Burr was receiving briefings and talking only to senators, suggesting that the country was facing a growing health crisis that could affect the economy.
The Justice Department declined to comment on the warrant, which The Los Angeles Times reported for the first time.
The senator insisted that he based his business decisions exclusively on publicly released information that he read in financial news from Asia. Burr’s legal adviser, Alice Fisher, said the facts of the case would eventually “establish that her actions were appropriate”.
It is not illegal for lawmakers to make investment decisions based on public information. But insider laws, including the Stock Act that governs Congress, prohibit employees from making decisions based on specific, non-public information they receive in the course of their work.
Paul Shumaker, a longtime adviser to Burr, said the senator was adamant that he had done nothing wrong and did not resign. “He has no choice but to fight it. He has to clear his name, ”said Shumaker, adding that Burr’s resignation would amount to“ an admission of guilt ”and that would not interrupt the investigation.
Federal investigators also looked at stock negotiations by other senators at the same time, including senators James M. Inhofe, Oklahoma Republican; Kelly Loeffler, Republican of Georgia; and Dianne Feinstein, a California Democrat, according to a person informed of these cases. All three said they had done nothing wrong.
In April, law enforcement officials asked Feinstein “basic questions” about the stock transactions made by her husband during the period in question, said his spokesman, Tom Mentzer, on Thursday. He said Feinstein obeyed and provided documents that showed she was not involved.
A spokeswoman for Ms. Loeffler, Kerry Rom, said the senator “forwarded documents and information to the DOJ, the SEC and the Senate Ethics Committee, stating that she and her husband acted in an entirely appropriate manner and observed both the letter and the letter. as the spirit of the law. ”
Ms. Rom did not say whether the authorities requested the information or whether Loeffler proactively provided it, in an effort to contain a story that clouded her campaign for the Senate.
But Burr is the main target of the investigation and his case is more advanced, according to one of the investigators. Unlike other senators under scrutiny, Burr did not deny that he started the sales himself or that they were related to concerns about the coronavirus. He He asked the Senate Ethics Committee to investigate.
Mr. Burr’s scrutiny stems from his decision to sell 33 shares in the amount of $ 628,000 to $ 1.7 million. Sales liquidated a large part of Mr. Burr’s portfolio and came days after a series of briefings on the spread of the coronavirus that Burr received as chairman of the Intelligence Committee and member of the Senate Health, Education and Labor Committee and Pension Committee .
During the intelligence panel briefing on February 4, CIA officials sketched an initial picture of the geopolitical effect of an outbreak that was still confined to Asia. Other briefings for the health panel, including one the day before Burr’s stock transactions, featured senior government health officials who would later lead the country during the pandemic.
Investigators are probably trying to determine the content of these instructions, especially any information presented that was not publicly available, but it can be difficult. Much of the information can be confidential or resemble public reports at the time. And experts say that the so-called Congressional speech or debate clause could prevent investigators from directly questioning Burr about what he learned in the course of his duties as a senator.
Burr also has a history of warnings about the threat of pandemics. He helped draft legislation more than a decade ago to help the United States better prepare for such events. He announced this work in an opinion piece in early February, saying the country was “better prepared than ever” to respond to the coronavirus.
Fewer figures on Capitol Hill have played more prominent roles in recent years than Burr. A credible conservative vote, he has been the face and driving force behind a three-year bipartisan intelligence committee investigation into Russia’s interference in the 2016 elections and possible ties to the Trump campaign.
His insistence on carrying out the investigation and questioning the president’s close associates harshly has angered the White House at times, and relations between the president and the senator remain cold.
Some of Burr’s allies in the Senate privately questioned on Thursday why search warrants became public if Burr was cooperating.
“I don’t believe he did anything criminally wrong,” Sen. Lindsey Graham, a Republican from South Carolina, told reporters. “Maybe he used his judgment badly, I think, but I know Richard and he is the only guy I can say who really watches CNBC Hong Kong.”
Burr, whose term ends in 2022, has said he does not intend to run for re-election. But the ghost of the North Carolina senator facing an FBI investigation could further complicate Republican prospects in what is perhaps the most important state on this year’s election map.
Democrats in North Carolina have renewed their calls for Burr to resign completely from his Senate seat.
“If he still has any sense of decency, Burr will step down immediately, and if they have any respect for the rule of law, Republicans across this state and across our country will demand the same,” said Wayne Goodwin, president of the state of Democratic Party.
Emily Cochrane, Jonathan Martin and Adam Goldman contributed to the report.