The U.S. House of Representatives passed a bill on Wednesday that would prohibit members of Congress, their spouses, and dependent children from buying new stocks while in office. The Stop Insider Trading Act, introduced by Rep. Bryan Steil (R-WI), also requires a seven-day public notice before selling existing stocks and imposes penalties for violations. The bill passed 232-198, with 13 Democrats joining all Republicans in support.
The legislation includes a controversial voter identification provision, which has drawn opposition from Democrats. Critics argue the bill does not go far enough, as it allows lawmakers to retain existing stock holdings and does not extend restrictions to the executive branch. Supporters, including House Speaker Mike Johnson (R-LA), argue the measure addresses concerns about congressional insider trading and corruption.
Key Provisions and Reactions
The bill prohibits new stock purchases by lawmakers but permits them to keep and sell existing holdings. It also mandates a seven-day notice before selling stocks, with penalties of $2,000 or 10% of the transaction value, whichever is greater. The inclusion of a voter ID provision has complicated bipartisan support, with Democrats arguing it is unrelated to the stock trading ban.
Democratic Opposition
Democrats have criticized the bill for not requiring lawmakers to divest their current stock holdings or extending restrictions to the president and vice president. Rep. Joe Morelle (D-NY) called the bill a "sham" for allowing continued stock ownership. Rep. Teresa Leger Fernandez (D-NM) noted that the bill does not prevent lawmakers from profiting off insider information.
Republican Support
Republicans, including Rep. Byron Donalds (R-FL), have urged Democrats to support the bill, arguing it sets a higher ethical standard for lawmakers. Rep. Bryan Steil emphasized that the bill ensures lawmakers cannot use their positions to profit from insider information. House Speaker Mike Johnson highlighted the bill as a step toward addressing public concerns about congressional corruption.
Broader Context
The bill follows years of scrutiny over lawmakers' stock trading activities, with ethics watchdogs and the public calling for stricter regulations. A 2012 law already prohibits trading on insider information, but enforcement has been weak. The inclusion of the voter ID provision has made the bill a political flashpoint, with Democrats accusing Republicans of using it to distract from the stock trading issue.