A bipartisan group of senators, led by Sen. Josh Hawley, R-Mo., has taken a stand against members of Congress profiting from trading stock. This renewed effort aims to prevent lawmakers from using insider information for personal financial gain. The proposal is a significant step in the ongoing saga of implementing regulations to restrict lawmakers’ stock transactions. The Senate Homeland Security & Governmental Affairs Committee is set to consider the bill on July 24, marking the first formal legislative action on this issue.
The proposed amendment calls for an immediate ban on members of Congress, the president, and the vice president from purchasing stocks and covered investments. Lawmakers would have a 90-day window to sell off their existing stocks. Additionally, the bill would extend the trading prohibition to include lawmakers’ spouses and dependent children starting in March 2027. By the same year, all top government officials, including the president and vice president, would be required to divest from covered investments. Violating the divestment mandate would result in penalties equivalent to either a portion of their monthly salary or a percentage of the asset’s value in question.
This push to ban stock trading by members of Congress was initiated by Sen. Jon Ossoff, D-Ga., in 2021. He set an example by placing his own stock portfolio in a blind trust. The movement gained momentum following revelations of profitable trades made by several senators early in the COVID-19 pandemic. These trades coincided with classified briefings warning about the economic impact of the virus. While the FBI launched insider trading investigations, no criminal charges were filed. The growing public outcry prompted a shift, with even former House Speaker Nancy Pelosi dropping her resistance to the ban, given her husband’s substantial investment activities.
The proposed bill represents a significant milestone in the effort to curb stock trading by members of Congress. By introducing strict restrictions and penalties, lawmakers aim to level the playing field and prevent insider trading. The bipartisan support behind this initiative signals a broader acknowledgment of the need for ethical standards and transparency in government operations. If this bill passes, it would mark a historic reform aimed at restoring trust in the integrity of legislative decision-making processes.
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