FBI Director Kash Patel is facing a lot of backlash over two stock purchases he made earlier this year.
Joe Neguse, the U.S. representative for Colorado’s 2nd congressional district, questioned Patel during a House hearing on Wednesday, September 17, about recent disclosures showing he purchased $15,001–$50,000 worth of Krispy Kreme (NASDAQ: DNUT) and $50,001–$100,000 worth of ON Semiconductor (NASDAQ: ON) shares on May 9 and May 12, respectively.
“I just follow certain industries, and I thought they would be a good investment,” the Director said, explaining why he invested in the two companies specifically.
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According to financial disclosure reports, Patel has also sold off dozens of positions in recent months, seemingly to avoid conflict of interest. The most sizeable sales include Nvidia (NASDAQ: NVDA), Palantir (NYSE: PLTR), Eli Lilly (NYSE: LLY), Apple (NASDAQ: AAPL), and Meta (NASDAQ: META), as well as $50,000–$100,000 worth of Grayscale Bitcoin Trust (GBTC).
Kash Patel denies conflict of interest accusations
The situation continues to unravel as lawmakers continue pushing bipartisan efforts to prohibit members of Congress and high-ranking public officials from trading individual securities. During his testimony, the FBI helmsman even agreed that he would work with Neguse on the bill.
Patel was also questioned in regard to a stock holding valued $1–$5 million in the company that controls Shein, a Chinese ecommerce and fashion giant embroiled in controversies, including intellectual property and data theft in the U.S.
Hank Johnson, the U.S. representative for Georgia’s 4th congressional district, cited the investment as incongruent with Patel’s position as the leader of the largest U.S. law enforcement agency, given that China is the nation’s primary security threat.
“It wasn’t a decision I made. I’m not a trade expert,” the FBI Director said in response.
Krispy Kreme meme rally
Shares of Krispy Kreme briefly spiked on Wednesday following Patel’s remarks, surging as much as 11.5% intraday.
However, the meme rally was short-lived, as DNUT shares closed up just 0.96%. The doughnut chain thus remains down over 67% year-to-date.
ON Semiconductor also saw a brief spike, but it also ended the day up less than 1%.
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