David Perdue, after his election to the U.S. Senate, was granted a lucrative compensation package by a financial technology firm that would grow to be worth more than $6 million, according to a review of congressional financial disclosures and Securities and Exchange Commission filings. After his tenure as CEO of Dollar General, Perdue, a Georgia Republican, was appointed to the board of directors of the financial marketing firm Cardlytics in 2010. For his service on the board, which lasted until the end of 2014, he was granted a total of 300,000 stock options, according to filings with the SEC.

Perdue nearly lost out on the value of the options by winning the Senate seat in November 2014, as options typically expire not long after a board member or employee leaves the company, and the company had not yet gone public, meaning Perdue couldn’t exercise his options. Perdue couldn’t remain as a compensated director on the board as a sitting senator without creating illegal conflicts of interest. But the company altered the terms of the compensation package so that Perdue could still benefit even after he was elected to the Senate. According to SEC filings, the firm extended the period he was able to exercise the options all the way out to 2020 and 2022. The company went public in 2018, with time still left on the clock for Perdue to exercise his options.

The options were priced generously. Perdue was able to buy his two chunks of shares for $2.36 and $4.44. In February, the stock topped out above $98.

Perdue’s stock trading has become a political liability in an election year. In apparent recognition of that reality, on Friday he told the local business press he had moved his investments into broad-based stock funds and would stop trading individual stocks. He would continue to hold on, he said, to three stocks that he earned through his service on corporate boards, one of those being Cardlytics.

Perdue also served, from 2011 to 2014, on the board of Graphic Packaging Holding Company, for which he received both stock and direct compensation. SEC files say he was awarded roughly $70,000 in direct compensation annually, along with $90,000 worth of shares annually, adding up to more than half a million in compensation. He made more than $1.5 million serving on the board of Alliant Energy. He left both boards in 2014 ahead of being sworn into the Senate.

Cardlytics, part of the burgeoning financial technology industry, or fintech, mines and analyzes consumer and banking data, using individual financial transaction history to help companies optimize and personalize marketing efforts in a way that significantly implicates regulations around privacy. The company’s professed ability to stay within the law while extracting unusually valuable personal data is a prime selling point.

Perdue serves on the powerful Senate Banking Committee and has worked to roll back regulations that govern firms like Cardlytics. He also serves on the Securities, Insurance, and Investment Subcommittee, which more directly overlaps with firms like the Atlanta-based Cardlytics, and has sponsored legislation that would be to the firm’s benefit. “Overregulation has sucked the very life out of our free-enterprise system,” Perdue explains on his Senate website. “By rolling back confusing and often contradictory regulations, and undoing the most onerous parts of Dodd-Frank, we’ve begun freeing up trapped capital and started to put it to work in our economy. These efforts are making banks work for average Americans and generating much-needed economic growth to help solve our national debt crisis.”

According to filings with the SEC, Cardlytics “accelerated Mr. Perdue’s options” — which means that he was fully granted the ones that had yet to vest — “and extended the post-termination exercise periods applicable to Mr. Perdue’s option grants to October 12, 2020 and January 25, 2022.” Having extra time to exercise the options gives the stock more opportunity to rise and Perdue more time to decide whether to exercise them, thus dramatically reducing his risk. According to his Senate financial disclosure reports and SEC filings, Perdue was granted the option to purchase the stock at two separate prices, known as strike prices: 59 cents and $1.11, which ultimately cost roughly $300,000. When the value of the company rises above the strike price, the options are said to be “in the money.”

Kirk Somers, chief legal officer at Cardlytics, told The Intercept that most of the shares had vested by December 2014, so accelerating the remaining 4,167 shares yielded him little in additional benefit. “I was personally there at the time and the board unanimously agreed with the support of outside counsel to pull forward the options which had not yet vested,” he said in a statement. “These amounted to less than 2 percent of the Senator’s total options, and they were pulled forward by less than a month. This was standard practice for a private company, and something we had also done for others.”

Indeed, the genuine value came in the extension of the time he could exercise the shares.“At the time, the options had no value since the company wouldn’t end up going public for another 4 years,” said Dani Cushion, Cardlytics’s chief marketing officer. “Senator Perdue was a very involved and valuable board member, particularly as a past CEO of a retail company. In 2014, the board unanimously agreed to give Senator Perdue the grace period to make use of the options he had earned. This is not unique to Senator Perdue and in other circumstances with employees leaving Cardlytics, the board has also granted the same opportunity. What he earned before he went to the Senate was his only compensation for his four years of service, and this type of acceleration and extension is common practice.”

Brian Foley, an executive compensation consultant and managing director of the firm Brian Foley & Company, said that allowing Perdue to leave with all of his options in 2014 was an understandable decision. Allowing him to stretch the time he had to exercise the options out to 2020 and 2022, he added, was quite generous.

“To do it as someone is departing the board is very unusual and I’ve only been doing this 45 years. It’s very unusual,” Foley said.

“Extending six or eight years is long,” said Andy Restaino, an executive compensation consultant. “You’re overriding a policy that’s in place. Either you’re questioning the policy or you’re doing something special.” There isn’t much data on how common such arrangements are, said Restaino, because private companies aren’t required to report them unless they go public.

“He was treated very generously when he was elected,” Foley added.“Extending the exercisability turned out to be a significant benefit, and you could have certainly thought that at the time, because at the time you knew the option was worth spit, or half of spit.”

On Wednesday, the New York Times exposed an arrangement whereby Kelly Loeffler, Georgia’s junior senator who is also running to retain her seat this year, was the beneficiary of a windfall from her husband’s company, International Exchange, which owns the New York Stock Exchange. Loeffler’s payout was valued at more than $9 million. “It looks, feels and has the sweet aroma of a pure windfall,” Foley is quoted telling the Times of Loeffler’s arrangement.

Foley said he smelled something similar in Perdue’s deal. “This one has that same sickly aroma that the junior senator’s deal had. They let him keep the play and let him keep until October of this year and January of 2022. That’s a very long time to keep the play,” he said.

In February 2018, the company went public, and its value began rapidly rising. Perdue, according to Senate disclosures, finally exercised his options on July 18, 2018, listing the asset as valued between $1 million and $5 million.

Having extra time to exercise the options gives the stock more opportunity to rise and Perdue more time to decide whether to exercise them, thus dramatically reducing his risk.

On January 23 of this year, the stock closed at just under $87 per share, meaning that Perdue’s shares — which had gone down from 300,000 shares to 75,000 following a 4-to-1 stock split, according to SEC records — were worth more than $6.5 million. The shares had cost him roughly $300,000, according to SEC documents and an analysis of disclosure records.

Ahead of the impending market crash, Perdue, that same day, sold between $1 million and $5 million worth of Cardlytics stock, according to Senate disclosures.

The sale was well timed. On March 3, five weeks later, with the stock trading at $86, the company announced that CEO Grimes was stepping down and the stock nosedived, dropping to $54 by the next day, and bottoming out under $30 on March 18. On that day, Perdue bought back, at a steep discount, the bulk of the shares he had sold, buying at least $200,000, and as much as $500,000 worth, according to Senate disclosures, putting his holdings close to his original grant. The stock has climbed since and now hovers at around $50.

Most of the executives, including Grimes, involved in that restructuring had helped Perdue win his race in 2014, contributing $24,500, according to campaign finance reports. Grimes, who is now executive chairman, also gave $5,600, the maximum allowable contribution, to Perdue’s campaign in 2020. “It was a well-timed, sudden exit after years of slumbering,” said Foley. “Like Andrew Cuomo says, I’m just giving you the facts, you can draw your own conclusions.”

In September 2019, Grimes and co-founder, president, and COO Lynne Laube, also a significant donor to both of Perdue’s Senate campaigns, were honored with the E. Milton Bevington Distinguished Entrepreneur Award. Perdue introduced the pair from the stage. In 2016, Perdue toured Cardlytics’s Georgia headquarters, posing for a photo.

Last February, Perdue introduced legislation to undercut the Consumer Financial Protection Bureau’s funding stream. That same month, a year after Cardlytics went public, he introduced a bill to loosen regulations on financial tech startups. Georgia, he said at the time, has “become a hotbed for fintech, biotech, and other emerging technology companies.” The bill was introduced with Democrats Kyrsten Sinema and Gary Peters and Republican Thom Tillis. “This bipartisan action removes one of the most onerous requirements off of these technology startups and will allow Georgia’s industries to compete in public markets and on the global stage,” Perdue said. Cushions said that Cardlytics, which does not employ a lobbying firm in Washington, has never lobbied Perdue.

The stock-trading scandal was kicked off when ProPublica first reported that Sen. Richard Burr, R-N.C., chair of the Intelligence Committee, sold the bulk of his stocks after a private briefing on the severity of the coronavirus pandemic in early February. Burr has said that he made the trades based on his reading of media accounts of the spread of the virus in China. On Wednesday, ProPublica reported that Burr’s brother-in-law made a series of stock sales the same day, February 13, as Burr. On February 7, Burr co-authored an op-ed assuring that “the United States today is better prepared than ever before to face emerging public health threats, like the coronavirus.”

Loeffler and Perdue, who were hit by the Atlanta Journal-Constitution for similarly selling large chunks of stocks in February and March, have both claimed that they were not personally responsible for the sales of stocks, saying that financial advisers made the trades. But neither Loeffler nor Perdue held their investments in a blind trust at the time.

On Friday evening, the Atlanta Business Chronicle reported that Perdue said a “majority” of trades were made by outside advisers. “Since 2005, we have retained outside, independent financial advisers like Goldman Sachs who themselves, or through outside fund managers they identify, handle the majority of our stock investments,” Perdue is quoted telling the outlet.

That Perdue was now saying only that his advisers handled “the majority” of trades suggested that he and/or his wife also handled some of them. Perdue is familiar with stock trading: he was previously the CEO of a private investment firm, The Aquila Group, according to SEC files. But a Perdue spokesperson told The Intercept that “outside, independent financial advisors continue to be the only individuals making transactions,” saying that Perdue had meant that Goldman Sachs makes a majority of the trades, and other brokerages make the rest.

In March, as first reported by the Atlanta Journal-Constitution, Perdue dumped his holdings in casino shares ahead of the pandemic-driven market crash, while investing instead in the drugmaker Pfizer and the firm DuPont, which makes medical supplies important to the pandemic response.

Toward the end of February, Perdue sold upward of $165,000 worth of Caesars Entertainment Corporation, a casino company. At the same time, he bought up to $260,000 worth of stock in Pfizer and $105,000 in DuPont, at the upper end of the ranges listed in the filings. Casinos have imploded in the midst of the pandemic.

Perdue also purchased shares of Delta, an airline based in Georgia, and Disney. The Delta purchase is a strong mitigating trade for Perdue, as it would have been a foolish stock to buy if the buyer expected the economy to close down. The Disney purchase is a mixed bag, as the company’s theme parks have closed and revenue from its theatrical releases will be ravaged, but its streaming and other content distribution businesses are well-positioned to profit from quarantined viewers.

The Delta trade also underscores the ethical perils of lawmakers trading stocks, as Congress debates a bailout of the airline industry. It is illegal for members of Congress to trade on nonpublic information they learn in the course of their duties, but it is legal for members of Congress to own and trade stocks, even as they legislate in ways that will impact their holdings, such as the potential airline bailout. Perdue, as part of his sell-off and move toward non-controversial, broad-based investments, no longer owns the Delta shares.

The purpose of offering directors stock options that vest over a period of time, meanwhile, is to retain talent. But letting Perdue leave Cardlytics with his options and then extending the period to exercise by such an unusual length — typically, board members have 90 days to exercise after departing the board — does nothing for shareholders.

“What were the Cardlytics shareholders getting for the five, six years extended?” Foley said.