A bipartisan group of United States senators has renewed efforts to push through laws that will ban members of Congress from trading stocks.
In a July 9 letter to House Speaker Mike Johnson and Democratic Leader Hakeem Jeffries, a bipartisan group of 20 senators proposed an amendment to the Stop Trading on Congressional Knowledge Act of 2012 to stop lawmakers from stock trading.
“Congress should not be here to make a buck,” said US Senator Josh Hawley at a press conference. “There is no reason why members of Congress ought to be profiting off of the information that only they get and the rest of the American people don’t get.”
The Senators also noted that 97 members had traded stocks where the committees they oversaw had a direct impact and that members of Congress had, on average, outperformed the S&P 500 by 17.5%.
The senators cited a recent investigation that found that one in seven sitting members of Congress had violated the STOCK Act between 2021 and 2023.
The proposed amendment to the STOCK Act would ban sitting congresspeople from trading within 90 days of the bill being signed.
Additionally, it would ban the sitting President, Vice President, and the spouses and dependent children of all sitting Congress members from trading stocks beginning in March 2027.
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The penalty for violating the new laws would be a fine of 10% of the value of the asset traded, a significant step up from the current penalty, which is just $250 per transgression.
“It is abundantly clear that more is needed to stop this type of behavior that is not only unethical but also undermines the public trust in our democratic institutions,” wrote the Senators in their letter.
“Members of Congress should be working in service of their constituents, not using their positions to line their own pockets,’ Senator Golden said in a July 9 statement.
“Anyone who feels the same should have no problem voting for this common sense, long overdue step.”
Members of the House first proposed major amendments to the STOCK Act in January 2022, in a letter addressed to then-Speaker Nancy Pelosi and Minority Leader Kevin McCarthy.
The effort to ban Congress members from trading was aided by widely reported public disclosures that detailed highly profitable trades of several top lawmakers during the early days of the COVID-19 Pandemic.
The most notable of these was Congresswoman Pelosi, who became subject to widespread public attention after it was reported her successful trading activity had contributed to her net wealth ballooning to over $250 million while only earning an annual congressional salary of $193,000 per year.
Pelosi has several dedicated copy-trading and stock-picking services that seek to imitate her trading activity for profit.
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