WASHINGTON – Today, Representatives Pramila Jayapal (WA-07), Matt Rosendale (MT-02), and Ken Buck (CO-04) introduced bipartisan legislation to ban Members of Congress and their spouses from owning and trading stocks.
“Only two in ten Americans trust that our government is working in their best interest,” said Congresswoman Jayapal. “Members of Congress are elected to serve the people, not our own financial interests. As long as members and their spouses are allowed to trade individual stocks – the door to corruption remains open. This legislation is a long overdue, necessary step to raise the ethical standards of Congress and restore the people’s trust in our work.”
“We’ve made strides to ensure that Congress returned to an honest and properly functioning legislative body – ending insider trading by Members is another crucial step that will restore public confidence in our institutions,” said Representative Rosendale. “It’s unacceptable that so many career politicians abuse their office to enrich themselves rather than putting the interests of the American people first. I’m proud to introduce the Bipartisan Ban on Congressional Stock Ownership Act with Congresswoman Jayapal and Congressman Buck.”
“It’s past time for Washington to do the right thing and ban Members of Congress from using their elected position to enrich themselves,” stated Congressman Ken Buck. “Members of Congress receive information that the public does not, it is inappropriate for elected officials to then turn around and invest or buy stocks using that insider information. The American people must have trust that Congress uses this information only to conduct official business, not benefit a stock portfolio. I’m proud to work in a bipartisan manner with Congresswoman Jayapal and Congressman Rosendale on this important issue to restore some faith and trust in Congress.”
The Bipartisan Ban on Congressional Stock Ownership Act goes beyond other proposals to ban stock trading in many ways. Specifically, the legislation:
- Bans Members of Congress and their spouses from owning and trading individual stocks, bonds, commodities, futures, and other securities including an interest in a hedge fund, a derivative, an option or other complex investment vehicle. It does not ban common, widely held funds, such as mutual funds and ETFs, as long as those funds do not present a conflict of interest and are diversified.
- Establishes a civil penalty of up to $50,000 for each violation to be enforced by the Department of Justice and the U.S. Office of Special Counsel.
- Allows a transition period for lawmakers to divest their holdings and come into compliance, including a similar period for newly elected Members starting when they’re sworn in, and allows deferral of taxation on gains from investments that they and their spouses are forced to divest.
The legislation is endorsed by the Project on Government Oversight (POGO) and Citizens for Responsibility in Ethics (CREW).
“Congress is mired in a crisis of legitimacy. When Members of Congress own or trade individual stocks they create the inescapable appearance that they are working for their own financial interests rather than on behalf of their constituents “ said Debra Perlin, Policy Director of Citizens for Responsibility and Ethics in Washington (CREW). “The Bipartisan Ban on Congressional Stock Ownership Act would help rebuild public trust in our government by requiring members and their spouses to fully divest their individual holdings, and to own only non-conflicting assets like diversified exchange-traded mutual funds. This is a necessary first step towards rebuilding trust in our government institutions and ensuring that members are not serving their own financial interests. CREW is happy to endorse this bill and calls on Congress to send it to President Biden’s desk as expeditiously as possible.”
The legislation is cosponsored by Reps. Jake Auchinloss (MA-04), Rosa DeLauro (CT-03), Jesús “Chuy” Garcia (IL-04), Andy Kim (NJ-03), Jerrold Nadler (NY-12), Eleanor Holmes Norton (DC-00), Katie Porter (CA-47), Mark Takano (CA-41), and Paul Tonko (NY-20)
Jayapal has made stock ownership a major tenet of her push to restore trust in government. She originally introduced this legislation last Congress.
Issues: Government Reform & Ethics