The Securities and Exchange Commission (SEC) is investigating potential insider trading of shares of Eastman Kodak Company (NYSE: KODK) prior to the company’s announcement of a $765 million loan provided by the Trump administration under a Defense Production Act deal.
Under the deal, Kodak will use the loan to produce generic drug ingredients in response to the COVID-19 pandemic.
The Wall Street Journal first reported the SEC investigation on Tuesday, citing sources familiar with the matter.
The probe comes after Sen. Elizabeth Warren, D-Mass, a member of the Senate Committee on Banking, Housing, and Urban Affairs, called on the SEC to look into the unusual trading activity involving Kodak shares before the announcement on July 28.
Sen. Warren concerned about Kodak executives’ stock purchase
In her letter to SEC Chair Jay Clayton, Sen. Warren wrote, “There were several instances of unusual trading activity prior to the announcement, raising questions about whether one or more individuals may have engaged in insider trading or in the unauthorized disclosure of material, nonpublic information regarding the forthcoming $765 million loan awarded under the Defense Production Act.”
