Democrats in the House of Representatives may soon introduce legislation to ban members of Congress, senior staff and potentially their spouses from buying, selling or trading stocks, according to a report from Punchbowl News.
According to the outlet, the framework legislation would force lawmakers, staff and their spouses to either put their assets in a blind trust, or divest completely; Punchbowl reports the legislation would not ban members or others from holding mutual funds.
House Administration Committee chair Rep. Zoe Lofgren, D-Calif., told the outlet Democrats are “almost ready to move forward on this.” A committee spokesperson confirmed to Spectrum News the legislation might be introduced “as early as next week,” and the details reported by Punchbowl and other outlets are “component(s)” of what the final legislation will likely include.
The legislation, should it be introduced in the next several weeks, would come shortly before lawmakers leave for August recess, leaving limited time for a vote before the November midterms.
Potentially complicating the bill’s passage through Congress are a slew of other proposals put forward both in the House and the Senate, which include varying degrees of restrictions on lawmakers, staff, spouses and – in some cases – dependents.
One dates back to last January, when Reps. Abigail Spanberger, D-Va., and Chip Roy, R-Texas, introduced the Transparent Representation Upholding Service and Trust in Congress Act – or TRUST in Congress Act, for short. The bill, whose 21 other cosponsors are made up of five Republicans and 16 Democrats, would require lawmakers, their spouses and dependent children to place certain assets into blind trusts, among other provisions.
A separate bill was introduced to the House just two months later by Rep. Raja Krishnamoorthi, D-Ill., with similar bipartisan support: its 25 cosponsors range from vocal progressive Rep. Alexandria Ocasio-Cortez, D-N.Y., to the ultra-conservative Rep. Matt Gaetz, R-Fla.
The Ban Conflicted Trading Act would not, like the TRUST in Congress Act, extend to family members of lawmakers. Instead, it would ban members of Congress and certain employees from the purchase or sale of any futures, or from entering into a transaction that would create a “net short position in any security.”
At least two such bills were introduced in the Senate this past January by Sen. Jon Ossoff, D-Ga., and Sen. Josh Hawley, R-Mo., although the language differs slightly between the two proposals.
It remains unclear what provisions exactly will be included in Lofgren’s anticipated proposal. But the passage of any bill is largely up to party leadership, meaning either House Speaker Nancy Pelosi, D-Calif., or Senate Majority Leader Chuck Schumer, D-N.Y., would need to take action on the issue.
Pelosi, who last year balked at the suggestion that lawmakers and their spouses should be banned from selling or buying stocks, has since warmed to the idea – likely due to mounting pressure from both political parties.
“I said to the House Administration Committee, review all the bills that are coming in and see which ones – where the support is in our caucus,” Pelosi told reporters at a press conference in January, later adding: “I just don’t buy into it, but if members want to do that, I’m ok with that.”
Pelosi has come under increasing fire for her stance on stock trading, particularly in light of an expansive Business Insider investigation last year that found dozens of lawmakers and senior staffers have repeatedly violated an anti-insider trading law known as the STOCK Act.
The Stop Trading on Congressional Knowledge Act, or STOCK Act, was signed into law by then-president Barack Obama in 2012. The act aims, in part, to “prohibit Members of Congress and employees of Congress from using nonpublic information derived from their official positions for personal benefit,” and passed both the House and the Senate on a widely bipartisan basis.
The bill itself does not ban members of Congress from trading stocks, but requires certain government officials – like lawmakers, the president and vice president, and other executive and legislative employees – to report any stock trades within 45 days of the transaction.
More recently, Pelosi raised eyebrows for a Tuesday filing – which came the day before the Senate approved legislation to boost domestic manufacturing of semiconductor chips – indicating that her husband, Paul Pelosi, dumped $5 million worth of Nvidia stocks, one of the nation’s largest chip-makers. The documents noted, however, that the sale incurred a loss of $341,365.
Still, Republicans have taken aim at the stock trade, with House Minority Leader Rep. Kevin McCarthy, R-Calif., suggesting Pelosi might have a conflict of interest.
“Look, I think the Speaker of the House has greater determination of what comes to the floor, what gets out of the committee,” McCarthy told reporters on Friday, after news of the potential stock ban was released. “And her husband didn’t just trade stock, he traded options. I think what her husband did was wrong.”
Pelosi’s office pushed back against those claims.
“As always, he does not discuss these matters with the Speaker until trades have been made and required disclosures must be prepared and filed,” Pelosi spokesperson Drew Hammill told The Hill. “Mr. Pelosi decided to sell the shares at a loss rather than allow the misinformation in the press regarding this trade to continue.”