In August, House Democrats have plans to introduce a proposal banning members of Congress, their spouses, and senior staff from trading stocks. The legislation would force lawmakers, their spouses, and top aides to give up control to an independent third party, put the assets into a blind trust, or sell them all together.
The Democratic House majority hopes to push the legislation through to a vote in September. “We’re almost ready to move forward on this,” House Administration Committee Chair and member of the Jan. 6 House Select Committee, Zoe Lofgren (D-CA), told the Punchbowl on Wednesday.
The top two congressional Democrats, Speaker of the House Nancy Pelosi (D-CA), and Senate Majority Leader Chuck Schumer (D-NY) are reportedly on board. That’s a reversal from last year, when Pelosi refused to support a stock trading ban – saying members of congress should be able to participate in the “free-market economy.”
But the California representative, along with her Senate counterpart, had a change of heart earlier this year.
In @PunchbowlNews AM — MASSIVE NEWS for the hill
House Dems will propose BANNING members, senior aides and spouses from holding and trading stocks.
— Jake Sherman (@JakeSherman) July 28, 2022
The Democratic rush to ban stock trades comes on the heels of Business Insider‘s investigation into violations of 2012’s Stop Trading on Congressional Knowledge (STOCK) Act.
The report discovered nearly 200 top congressional staffers and over 50 lawmakers running afoul of the decade-old law “designed to prevent corruption” and conflicts of interest.
All members of both chambers were assigned a rating: Green for financial compliance, yellow for those on the cusp of potentially breaking the law, and red for those in congress in “danger” of ethics violations.
Out of 13 lawmakers, Sen. Diane Feinstein (D-CA) was the only Senate member listed in the red. Each one was found to have either violated the STOCK act or, according to the study, “They haven’t themselves taken proactive steps to avoid potential conflicts of interest.”
Recently House Speaker Nancy Pelosi came under scrutiny when her husband Paul Pelosi unloaded shares of Nvidia amid the passing of legislation regarding U.S. production of semiconductors.
The proposed legislation appears to be a bi-partisan effort, with Senate Minority Leader Mitch McConnell (R-KY) saying, “I think it prevents such suggestions that you are going to be involved in insider trading.”
Original reporting by Jake Sherman, Heather Caygle, and Max Cohen at Punchbowl News.
Follow Ty Ross on Twitter @cooltxchick