More than two dozen House members from both sides of the aisle are calling for House leadership to “swiftly” ban members of Congress from owning or trading stocks while in office.
The 27 members, including 25 Democrats and two Republicans, signed a letter drafted by Rep. Jared Golden (D-ME) and addressed to House Speaker Nancy Pelosi (D-CA) and House Minority Leader Kevin McCarthy (R-CA).
“There is no reason that members of Congress need to be allowed to trade stocks when we should be focused on doing our jobs and serving our constituents,” the letter, first reported by Insider, reads.
The members write that the law in place to prevent lawmakers from trading on nonpublic information, known as the the Stop Trading on Congressional Knowledge, or STOCK, Act, is not sufficient, citing suspect trading activity from several members of Congress in the early days of the Covid-19 pandemic.
“In addition to ensuring that members’ access to information doesn’t advantage them over the public when trading stocks, as the STOCK Act sought, this would end the potential corruption of lawmakers pursuing policy outcomes that benefit their portfolios,” the letter reads.
The topic of barring lawmakers from trading stocks and other assets while in office has been picking up steam in recent months. Rep. Alexandria Ocasio-Cortez (D-NY) spoke out against the practice on her Instagram in early December, and earlier this month, two senators introduced competing bills to ban the practice, as did a House representative.
When questioned in December, Pelosi threw cold water on a potential ban. “This is a free market,” she said.
But last week, Pelosi seemed to change course and said during a press conference that “if members want to do that, I’m OK with that.” She has also asked the Committee on House Administration to look into increasing the fines for breaking the STOCK Act, according to Insider.
Several trades made by members of Congress right before the Covid-19 pandemic have gotten attention, and some have been investigated by the Department of Justice. (Sen. Richard Burr (R-NC) is currently under investigation by the Securities and Exchange Commission.) An academic paper published in January 2019 found that lawmakers routinely earn higher returns than average citizens.
Though the STOCK Act theoretically bans members of Congress from profiting from insider trading, in practice, “it it can be nearly impossible to determine what counts as ‘nonpublic knowledge’ or how personally involved members are in their stock trades,” Golden’s letter says. A law barring owning stock or trading at all would help restore trust that members of Congress aren’t just trying to “turn a quick buck,” the letter reads.
“Perhaps this means some of our colleagues will miss out on lucrative investment opportunities,” the letter reads. “We don’t care.”
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