- Richard Blum, Sen. Dianne Feinstein’s husband, sold $1.5 million to $6 million of Allogene Therapeutics stock from Jan. 31 to Feb. 18, 2020 as COVID-19 fears rose.
- The sales occurred near Allogene’s early-2020 low ($21.72 to $24.25) before the stock later surged to about $54 in May.
- Feinstein says her assets are in a blind trust, she did not direct the trades or attend a key Jan. 24 briefing, and she provided records to investigators.
- The DOJ and other probes cleared Feinstein, but questions persist about timing, information flow, and how truly blind such trusts are.
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The transactions in question involved Richard Blum’s sale of Allogene Therapeutics shares in late January and mid-February 2020—during a period when concern about COVID-19 was growing sharply in Washington and global markets were beginning to dip. The share prices were near the low end of Allogene’s valuation trajectory at that moment. Publicly disclosed prices show that the company’s stock closed around $21.72 on Jan 31 and $24.25 on Feb 18, and then surged—hitting highs near $54 in May 2020. This raises concerns about whether the timing of the sales was purely coincidental or informed by non-public information.
Feinstein’s defense is grounded in the fact that all her assets are held in a blind trust, which she claims gives her no involvement in specific investment decisions. She further stated she was not present at a January 24, 2020 classified briefing related to COVID-19—a date used by others (notably Senator Richard Burr) as a reference point for alleged insider knowledge. Feinstein’s office also turned over documentation and voluntarily answered questions from law enforcement—steps that led to the DOJ officially dropping the investigation into her, along with two other senators.
From a legal and regulatory perspective, several hurdles make whether the transactions constituted insider trading difficult to establish. These include establishing that Feinstein had non-public information and that she shared it, proving her knowledge or intent, and overcoming potential protections such as the “speech or debate” clause for Congressional actions.
Strategically, the case touches on broader issues: investor confidence in markets and oversight, political accountability, conflicts of interest, and how blind trusts are structured and managed. Allogene’s enterprise, focused on “off-the-shelf” allogeneic CAR T cell therapies, was poised for significant growth if successful; the market’s reaction post-February likely amplified gains for shareholders who had held through the early 2020 trough.
Key open questions include: Was Feinstein truly unaware of the timing of her husband’s decisions? Was information from Senate briefings used in investment decisions (implicitly or explicitly)? How reliably blind was the trust in practice? And do disclosure laws or STOCK Act enforceability sufficiently deter similar situations in the future?
Supporting Notes
- Richard Blum sold Allogene Therapeutics stock between Jan 31 and Feb 18, 2020, valued between $1.5 million and $6 million.
- Allogene stock was priced at $21.72 on Jan 31 and $24.25 on Feb 18. Subsequent peak was near $54 in May 2020.
- Feinstein claims her assets—as Senator—are in a blind trust and that she had no involvement in her husband’s decisions.
- Feinstein was not at a Jan 24 COVID-19 briefing, per her statement.
- DOJ dropped investigations into Feinstein, Loeffler, and Inhofe, leaving only Senator Burr under investigation.
- Allogene Therapeutics develops allogeneic CAR T cell therapies (“off-the-shelf” cancer treatments), a high-risk, high-reward biotech business with volatile stock performance.
- Legal experts note the difficulty in proving insider trading, especially when blind trusts and lack of direct financial control are asserted.
- Feinstein voluntarily provided documents to law enforcement to show lack of involvement in the trades.