Trading on Capitol Hill Under Scrutiny: Congress Members Eyeing a Ban on Stock Trading Amid Insider Trading Concerns
Republican Party High-Ranking Member Advocates for Stock Market Prohibition Following Customs Disarray
In the midst of the tumultuous stock market swings triggered by Trump's trade policy uncertainties, a key Republican figure has expressed support for outlawing stock trading among members of Congress.
The unpredictable market fluctuations have left investors reeling from substantial losses due to market crashes, yet they've also gained from market surges. Some Congress members have profited, making Representative Marjorie Taylor Greene, a staunch Trump ally, a subject of intense scrutiny. Just prior to the sudden suspension of Trump's tariffs, Greene made stock purchases amounting to thousands of dollars. These purchases were made in companies like Apple, Amazon, and Merck, causing suspicions of insider trading to arise.
Congress members are expected to disclose their trades, but not the exact volume of trade. The SEC mandates reporting within 30 days; however, Greene's trades were not initially disclosed, fueling further controversy.
The latest development in this saga comes from House Speaker Mike Johnson, a top Republican. He recently expressed his viewpoint, stating, "I reckon it's about time we cleaned up this old joint. We shouldn't allow the appearance of impropriety here." Johnson, previously non-committal on the issue, now stands alongside the Democrats advocating for stricter regulations.
Last month, former President Trump also voiced his approval for tighter regulations on stock deals, declaring, "If they send it to me, I'll give it a hearty endorsement". However, he targeted former House Speaker Nancy Pelosi, alleging insider trading as the catalyst for her wealth. Though Trump presented no evidence to support his claims, Pelosi's spokesperson asserted, "Speaker Pelosi neither owns any stocks nor engages in any transactions ahead or behind."
The debate surrounding stock trading among members of Congress has gained momentum in recent years. In 2022, Rep. E.J. Magaziner introduced a bipartisan bill intending to prohibit congressional representatives from trading individual stocks, drawing support from Republicans like Rep. Chip Roy (R-TX). Sen. Jeff Merkley proposed a 2023 bill that would restrict members of Congress, the president, the vice president, and their families from acquiring stocks and cryptocurrencies starting in 2027. Other bills, such as the PELOSI Act, which aims to bar lawmakers and their spouses from trading stocks, have also been introduced.
Public opinion polls indicate a strong desire to restrict lawmakers' stock trading, with poll respondents from critical battleground districts expressing support for such measures. Some critics argue that merely banning trading is insufficient, advocating for the transfer of all congressional stock holdings into blind trusts to minimize potential conflicts of interest.
While the 2012 STOCK Act prohibits insider trading among members of Congress, ongoing debate persists regarding its effectiveness and the need for further legislative measures.
[1]: Magaziner's Bipartisan Bill https://www.congress.gov/bill/117th-congress/house-bill/205[2]: PELOSI Act (Preventing Elected Leaders from Owning Stocks Incorrectly) https://neguse.house.gov/media/press-releases/neguse-leads-bipartisan-efforts-to-ban-members-of-congress-from-trading-stocks[3]: Rep. Joe Neguse https://www.congress.gov/member/joe-neguse/N000585?r=169682[4]: Merkley's Proposal https://www.merkley.senate.gov/news/press-releases/merkley-lander-kaine-introduce-legislation-to-end-conflicts-of-interest-in-congress[5]: STOCK Act https://www.ntva.de/en/trump-stock-and-politics-about-insider-trading—trump-trade-wars-and-stock-jumps-in-congress—tightening-of-regulations-possible/GzrnmoZ
- The proposed PELOSI Act, led by Rep. Joe Neguse, aims to bar lawmakers and their spouses from trading stocks, a measure designed to minimize potential conflicts of interest.
- In the realm of finance, Rep. E.J. Magaziner introduced a bipartisan bill in 2022, intending to prohibit congressional representatives from trading individual stocks.
- While the STOCK Act of 2012 outlaws insider trading among members of Congress, ongoing debates persist regarding its effectiveness, prompting calls for further legislative measures.
