Stock ban proposed for Congress to stop insider trading among lawmakers
Category: News & Politics
Via: perrie-halpern • 2 years ago • 25 commentsBy: Ali Vitali, Julie Tsirkin and Haley Talbot
S E E D E D C O N T E N T
WASHINGTON — Representatives Abigail Spanberger and Chip Roy don't often find themselves fighting on the same side.
Spanberger, a moderate Democrat from Virginia, and Roy, a conservative Republican from Texas, support a bill that would ban legislators from trading stocks in public companies to keep them from profiting from the insider knowledge they're privy to on Capitol Hill.
Both are lining up behind legislation proposed by freshman Sens. Jon Ossoff, D-Ga., and Mark Kelly, D-Ariz., which would require lawmakers and their immediate family members to put any stocks they own in blind trusts, eliminating any perceived conflicts of interest.
"When we're going to briefings about issues that might be percolating in the world or when we're voting on legislation that could potentially move markets, it just seems inappropriate to me that we currently have the ability to be able to buy or sell stocks that may or may not be associated with those decisions," Spanberger told NBC News in an interview.
Spanberger introduced similar legislation in the House last year, called the Trust in Congress Act, which Roy cosponsored.
Congress tried to regulate stock trading by its members nearly a decade ago when the Stock Act became law to combat insider trading. But lawmakers still buy and sell hundreds of millions in stocks every single year, including at the beginning of the Covid pandemic, when they received detailed closed-door briefings before the rest of the country understood the scope of the disease.
"We're voting on this stuff every single day. And yet people are buying and selling stocks or buying and selling Pfizer while we're in the middle of the pandemic, like, how is that OK?" Roy said during an interview with NBC News.
A typical Stock Act violation rarely exceeds a fine of a few hundred dollars.
The FBI investigated Sen. Richard Burr, R-N.C., for stock trades made in February 2020 at the start of the Covid pandemic. The Department of Justice declined to press charges. Burr claimed he made the stock trades based on public information available from media reports.
Not all legislators are bullish about reform.
"Well, of course it should be carefully watched, but it is difficult to imagine in my job what is not a conflict of interest," said Sen. Dick Durbin, D-Ill.
House Speaker Nancy Pelosi echoed the skepticism, saying she "trusts" her members to do the right thing but "to give a blanket attitude of can't do this, and we can't do that because we can't be trusted. I just don't buy into that."
Pelosi said she doesn't hold stocks herself. Her husband, Paul Pelosi, a venture capitalist, would be subject to the new rules.
"When I was campaigning in Georgia and promising the people of Georgia that I would push for anti-corruption reforms, I didn't care then and I don't care now if that ruffled some feathers, including in my own party," Ossoff said in an interview, referring to his 2020 Senate bid, which hinged in part on allegations that his opponent had traded thousands of stocks that were under his purview as a member of the Senate subcommittee on cybersecurity.
"I just think the American people are kind of tired of the games up here on both sides of the aisle, and they just want to see us do our job, come up here as committed public servants and not get rich day trading," Roy said.
The issue has made its way to the midterm campaign trail in Pennsylvania and Arizona, spanning both parties.
"Lawmakers shouldn't be making profits off of the same companies they are supposedly regulating," wrote John Fetterman, the lieutenant governor of Pennsylvania and a Democratic candidate in that state's U.S. Senate race, in a recent twitter message.
"I don't think we can trust these people to police themselves. We just have to ban it," Senate candidate Blake Masters, an Arizona Republican, said in Decemberon a cable television show.
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I guess they'll just have to use friends and family to make their bets and subvert democracy.
How is stock trading subverting democracy?
Stock trading is not subverting democracy, insider stock trading is. There’s a reason why it is illegal.
You failed to answer the question.
You don't see that the people who regulate business shouldn't be trading in stocks?
I think you addressed this to the wrong person. Hal does see it, it is Greg who does not.
We elect representatives to govern, not use their privileged access to inside information to unfairly enrich themselves. This isn’t complicated.
But...how does it affect our "democracy"?
Because it is enabling the sellout of our elected representatives to concentrate their efforts on enriching themselves rather than doing the job they were elected to do? Why elect representatives at all?
It effects our "democracy" by causing the legislators to be more interested in legislating for their own personal interests and gains, than the country's common good.
If you're unfamiliar with the meaning of the term "Insider Trading" I recommend you google. (Legally it's considered a serious offense with harsh penalties). As it should be.
Friends yes, but according to this bill family will not be allowed.
Guess they will have to set up some sort of payment system with their "close" friends. Politicians have already gamed the system by selling their votes; or influence; I am sure they will figure away around this law if it is enacted as well.
I am sure they will figure away around this law if it is enacted as well.
Probably.
They need to make the law the same for politicians as everyone else. No insider trading by politicians, period. If they are caught they face the same penalties as everyone else.
I thought insider trading was already illegal?
Good for Ossoff for trying to keep a campaign promise. Congress critters shouldn't go to the Capital with the intention of getting rich. They're supposed to be for us.
And Nancy...fuck no we don't trust you
Nor your husband!
Amen!
Everyone in government who regulates anything business related should put their stock into blind trusts that put their stock into mutual funds.
Does that include State Gov't officials as well? If we are going to do it at the Federal level then it should also be done at the State level, IMHO...
If the State Government officials can do anything to influence the market; then yes, they need to be regulated as well.
Exactly. Reduce the ability to enrich oneself while serving the people and we would likely see fewer career politicians and more statespersons.
There is so much dark money floating around.
I wonder if this would be just a drop in the bucket.
I bet it doesn't even come up for a vote.
I will be shocked if it comes up for a vote. While there are clearly many other ways for these slime-balls to fill their pockets while 'serving the people', the stock market is very convenient and they will not want to give it up.
It may depend upon how well voters understand how it operates.
They need to address politicians ability to sell their vote and their influence then as well.
Stopping insider trading is a good start; but until they address political donation reform, speaking engagement fees, pay for play access (including hiring family members to positions they obviously aren't qualified for big money), gifts (free flights on private jets; lobbyist paid for vacations, etc), and golden parachutes (politicians hired straight to company boards, becoming high paid lobbyists; or high paid consultants) once their political career is over- there will always be career politicians.