Congress Weighs Insider Trading Bill

WASHINGTON — Aware that most Americans would like to dump them all, members of Congress hope to regain some sense of trust by subjecting themselves to tougher penalties for insider trading and requiring they disclose stock transactions within 30 days.

A procedural vote Monday would allow the Senate later this week to pass a bill prohibiting members of Congress from using nonpublic information for their own personal benefit or "tipping" others to inside information that they could trade on.

Insider trading laws apply to all Americans, but CBS' "60 Minutes" in November said members of Congress get a pass, citing investment transactions by party leaders and a committee chairman in businesses about to be affected by pending legislation.

The broadcast report raised questions about trades of House Speaker John Boehner, R-Ohio; the husband of Democratic leader and former Speaker Nancy Pelosi of California; and Rep. Spencer Bachus, R-Ala., chairman of the House Financial Services Committee.

All three denied using any insider information to make stock trades, but the broadcast set off a flurry of efforts in Washington to deal with the public perception.

A recent Wall Street Journal/NBC News poll of registered voters found 56 percent of them favor replacing the entire 535-member Congress. Other polls this year have given Congress an approval rating between 11 percent and 13 percent, while disapproval percentages have ranged from 79 percent to 86 percent.

House Majority Leader Eric Cantor, R-Va., said he's working on an expanded bill that would go beyond stock transactions and ban lawmakers from making land deals and other investments based on what they learned as members of Congress.

The Senate version of the Stop Trading on Congressional Knowledge (STOCK) Act would subject any member of Congress who violates the ban on insider trading to investigation and prosecution by regulatory agencies and the Justice Department. It also directs the House and Senate ethics committees to write rules that would make violators subject to additional congressional penalties.

"We can start restoring some of the faith that's been lost in our government by taking this common sense step of making members of Congress play by the exact same rules as everyone else," said Sen. Kirsten Gillibrand, D-N.Y., who with Sen. Scott Brown, R-Mass., wrote the bill "We must make it unambiguous that this kind of behavior is illegal."

President Barack Obama endorsed the bill in in State of the Union speech last week, saying he would "sign it tomorrow." Brown used that opening to briefly speak with the president as he was exiting the House chamber after Tuesday's address.

"The insider trading bill's on Harry's desk right now," Brown told Obama, referring to Senate Majority Leader Harry Reid. "Tell him to get it out, it's already there."

"I'm gonna tell him," answered Obama. "I'm gonna tell him, I'm gonna tell him to get it done."

Obama raised the issue again in his radio and Internet address on Saturday.

"The House and Senate should send me a bill that bans insider trading by members of Congress, and I will sign it immediately. They should limit any elected official from owning stocks in industries they impact," he said.

Also on HuffPost:

Comments

[Kevin W Clark]

07:48 PM on 02/05/2012

I am going to sleep so much better tonight knowing that congress has finally decided to stop suckling at the teat of insider-trading loopholes, at least while in full view of the public. /sarcasm off

[Goffy]

09:17 AM on 01/31/2012

The real problem of Congress is, its out of touch with American people and their struggles...
How do you represent average Joe or Jane, if your goal is to line your own pocket as Congressman/ women?

[Jay-Dub-U]

05:26 PM on 01/30/2012

The 26th amendment (granting the right to vote for 18 year-olds)
took only 3 months & 8 days to be ratified! Why? Simple! The people
demanded it.
Of the 27 amendments to the Constitution, 7 took 1 year or less to become the law of the land-all because of public pressure.
Congressional Reform Act of 2011
1. No Tenure / No Pension. A Congressman collects a salary while in office and receives no pay when out of office.
2. Congress (past, present & future) participates in Social Security. All
funds in the Congressional retirement fund move to the Social Security
system immediately. All future funds flow into the Social Security
system, and Congress participates with the American people. It may not
be used for any other purpose.
3. Congress can purchase their own retirement plan, just as all Americans do.
4. Congress will no longer vote themselves a pay raise. Congressional pay will rise by the lower
of CPI or 3%.
5. Congress loses their current health care system and participates in the same health care system as the American people.
6. Congress must equally abide by all laws they impose on the American people.
7. All contracts with past and present Congressmen are void effective NOW. The American people did not make this contract - Congressmen made all these contracts for themselves. Serving in Congress is an honor, not a career. The Founding Fathers envisioned citizen legislators, so ours should serve their term(s), then go home and back to

[getridofrep]

05:30 PM on 01/30/2012

Boy do I ever agree!!!!!

[ChrisG1001]

09:42 AM on 01/31/2012

Absolutely right on!!! This is just common sense. If everyone can forward this message to as many people as possible maybe we can make this happen.

[quicks9]

04:05 PM on 01/30/2012

how can you spank yourself ???????????????

[mrmoonlite5]

03:29 PM on 01/30/2012

IM from OREGON i would like 49 others one from every state to make a challange to take the seats of the congress already there

but you cant go the same as they do you have to have a attitude AMERICANS only

[StopMakingSense2]

02:13 PM on 01/30/2012

The self absorbed policing themselves? Another failure in the making! Greed knows no limits and congressmen make Ponzi schemers blush!

[jr3houpe1849]

01:39 PM on 01/30/2012

This issue is no different than getting money from lobbyist the people benefiting from this will not change the laws

[getridofrep]

05:33 PM on 01/30/2012

I believe outlawing lobbyists is the answer! How can we expect someone to have our interests at heart when the sneaky lobbyists are filling their pockets?

[UberdanSounds]

01:11 PM on 01/30/2012

Ya I'm not expecting much out of this either. It'll probably be just another PR stunt that will be look like Swiss Cheese...lots of holes.

[pj-smith]

12:51 PM on 01/30/2012

it won't happen...it will be riddled with loopholes if it gets passed at all...there is no good reason to trust any of them...believe what they say, not what they do

[getridofrep]

05:34 PM on 01/30/2012

Congress is made up of lawyers and of course they will weave the loopholes all thru it

[juliet12]

12:17 PM on 01/30/2012

No institution polices itself fairly. Duh.

[dcol]

12:17 PM on 01/30/2012

We also need to also throw any members in jail following the laws set forth for all Americans. Instant disbarment and rejection of their duties as a federal representative should be mandatory. House and senate members, workers, family, and friends should all be barred from any trading activities. Hard to control because it just takes a phone call to an anonymous party to do their transactions. Don't think this doesn't happen every day.

[rosiebag]

09:44 AM on 01/30/2012

Days after 60 minutes aired its story, I saw Pelosi calling it a bunch of hoop de do, well hoop de do to you, nancy.

[Raccoon1]

10:01 AM on 01/30/2012

Proof? Video clip? News article? Anything?

[rosiebag]

10:10 AM on 01/30/2012

Utube Pelosi on insider trading, shes there in all her glory. Hoopy de do!

[ChrisG1001]

09:40 AM on 01/30/2012

Insider trading laws already exist for the rest of us....why is Congress drafting a bill that addresses Congress??? This is a waste of their time at our expense. What is needed is a more diligent, independent review board to carefully monitor and enforce the current laws. If a member of Congress profits from insider trading they need to be removed from Congress and made to serve the same jail time as the rest of the nation. While we are at it, let's revise the rules for Congressional raises. As servents of the people their raises and benefits should be voted on by the public. No special treatment. Their raises should be tied to something that reflects the job they are doing - like the cost of living. Now lets remove them all and start over with fresh leaders and hold them to higher standards of ethical behaviour.

[ChrisG1001]

09:28 AM on 01/30/2012

Why is Congress wasting time drafting a special bill that addresses Congressional insider trading and profiteering when this is already a law that the rest of the US must abide by? Could it be they are going to write in loopholes our leaders can drive a truck through??? Once and for all, let's have more diligent, independent monitoring and enforcement. If a member of Congress is found to break a law we need to remove them from their position of leadership, confiscate their gains and sentence them to jail time. While we are at it, let's change how Congressional raises are awarded. Congressional raises and benefits should be tied to something meaningful, like the cost of living and then the citizens of the USA need to vote to approve their raises/benefits.

[ema123]

12:27 PM on 01/30/2012

Most likely they will waste time investigating each other and making false accusations as a political ploy, they wont police each other for real since anyone of them could be brought done its like honor among thieves, they wont rats dont rat on each other. The fact they did it when it was ethical wrong didnt stop them

[wackette]

08:54 AM on 01/30/2012

How much more bullsh*t can we take? Get your money out of the stock market... it's rigged against
us. The tax laws are created to lure us in for the big catch. We need to stop buying into it.

[Raccoon1]

10:02 AM on 01/30/2012

Can't trust the brokers. Can't trust the CEO's. Can't trust the raters. Can't trust the regulators.