Keith Alexander, the former National Security Agency Director owned and sold shares in commodities linked to China and Russia… all while the NSA was heavily spying on China and Russia.
Depending on who you ask, it’s either a question of insider trading, cashing in on incidental job knowledge, or a case of coincidence.
Before taking over as the director at the NSA, Alexander was a three-star general whose financial portfolio consisted almost entirely of average, unsexy mutual funds and a few technology stocks. Critics are now wondering why the director jumped to commodities trading when he hit the NSA, including trades in a market that even financial experts stay away from, saying that it’s run by an impenetrable “cartel” that can befuddle even the most experienced traders.
Alexander’s financial transactions have been documented in recently released financial disclosure forms that he was required to file, according to FP Magazine.
All of this sounds highly nefarious, however, when Alexander’s stock trades were reviewed by a government ethics official, it was determined that the former NSA director had done nothing wrong.
Here’s the flip-side of the story, however.
Keith Alexander reportedly made less than a few hundred dollars on his commodity trading, and may have even lost some money. Disclosure documents show that the NSA director earned “no reportable income” from the sale of commodity company stocks.
Whether Alexander made any money on the trades or not it’s irrelevant to watchdog groups that believe his position as the NSA director may have influenced his personal financial investments. The NSA routinely spies on foreign governments and businesses in countries like Russia and China. Not only are political decisions and tendencies mapped and considered, but so are country’s business trends and economic strategies.
As a result of the financial disclosure reports being disclosed and reported on by investigative journalist, Jason Leopold, (and published by Vice News), questions are being asked as to why Alexander sold a large amount of stock at a specific point in time in January of 2008.
The shares that were sold were in a company called Potash Corp. out of Saskatchewan, Canada. Potash Corp. is involved in the mining of a substance called potash, which is used in fertilizer. The potash market is largely controlled by businesses in Canada, Russia and Belarus. China, in turn, is the world’s largest purchaser of potash.
On the surface, all this seems pretty straight forward, but according to experts, the potash market is more complicated than it seems. Craig Pirrong, a finance professor and commodities expert at the University of Houston’s Bauer College of Business, says that the potash market is not for the average investor.
“It’s a market that’s really odd, involving collusion, where companies essentially coordinate on prices and output. Strange things happen in the potash market. It’s a closed market. Whenever you have Russians and Chinese being big players, a lot of stuff goes on in the shadows.”
In addition to dumping his Potash Corp. holdings, the NSA Director also got rid of his holdings in a Chinese aluminum manufacturer. The Aluminum Corp. of China Ltd., a state-owned company, is the second largest producer of aluminum in the world. After Alexander dumped his stock in the company, it was indicted by the Justice Department as a result of claims that it was hacking into American businesses and stealing secrets.
The hacking scandal was discovered by the NSA.
A government employee is prohibited from investing any more than $15,000 in any company “directly involved in a matter which you have been assigned to.” At no point in his tenure as NSA director did Alexander have more than $15,000 invested. However, there’s a gap in the financial disclosures released by the NSA, from 2005 to 2008. As such, there’s no record of when the former NSA director bought his shares in the commodities companies, or in what amounts.
[Image via The Washington Post]