The momentum behind a popular effort to ban stock trading in Congress members is growing. According to reports, Senate Majority Leader Chuck Schumer instructed fellow Democrats to unite behind a specific legislative proposal.
“After weeks of silence, Senate Democratic leaders have asked lawmakers to propose improvements on rules governing congressional stock trading,” Insider reports. “In a call Friday, Democratic leadership staff told legislative directors for Democratic senators about their aspirations for bringing a congressional stock-trading ban bill to the floor of the U.S. Senate.”
The development comes weeks after Sen. Jon Ossoff (D-Ga.) ignored pushback from prominent Democratic leaders — including House Speaker Nancy Pelosi (D-Calif.) — and unveiledLegislation that would prohibit members of Congress, their spouses and their children from buying or selling stock while they are in office.
“It’s working. Keep pushing,” Ossoff tweeted Sunday, highlighting the Senate Democratic leadership’s openness to the proposed ban.
So far, just eight Senate Democrats have officially signed on as co-sponsors of Ossoff’s bill (S.3494), which he introduced alongside Sen. Mark Kelly (D-Ariz.) last month.
“It’s time for Congress to act and ban members from trading stocks while they’re in office,” Sean Eldridge, founder and president of Stand Up America, said Sunday.
Despite the broad support of the public and growing support from rank and file lawmakers, some Democratic leaders are opposed to stock trading prohibitions. Steny Hoyer, House Majority Leader (D-Md. said last week that he’s “not sure that it’s necessary” to enact such a ban given existing rules against insider trading — rules that critics say are far too laxThey are rarely enforced.
Schumer, for his part, said last month that he doesn’t “own any stocks” and that banning individual trading by sitting lawmakers would be “the right thing to do.”
It’s unclear where Sen. Joe Manchin (D-W.Va.), a key swing vote who owns a stake in his son’s West Virginia coal business, stands on the proposal.
“I don’t own any stocks, and I think that’s the right thing to do.”
Chuck Schumer, Majority Leader of the House, discusses the recent push to prohibit members of Congress trading individual stocks. pic.twitter.com/pZ3V7EE4pm
— Forbes (@Forbes) January 11, 2022
A recent analysisCapitol Trades provides financial documents and reporting. MarketWatchIt was found that Congressmen and their families traded stock worth $355 million in 2021. This was a year when the coronavirus pandemic, which killed hundreds of thousands of Americans and drove many into financial ruin, occurred.
Insider trading is legal, but it has been illegal. long been commonplace on Capitol Hill, suspiciously timed transactions during the pandemic — particularly soon after Covid-19 was detected in the U.S. — brought fresh attention to lawmakers’ use of secret information to buy and sell stock.
Former Sen. David Perdue (R-Ga.), Ossoff’s Republican opponent in the 2021 U.S. Senate runoff in Georgia, was a prolific stock traderHe was accusedthe possibility of buying shares of companies that would have been affected by the pandemic using insider information
“Recent revelations about stock trades at the outset of the Covid-19 pandemic and economic downturn, increasingly prevalent violations of the STOCK Act’s reporting requirements, and investigations and even convictions of members of Congress pertaining to insider trading have all served to galvanize public interest and media scrutiny around real and perceived corruption in Congress,” a coalition of 14 advocacy groups wrote in a letter endorsing Ossoff’s legislation last month.
“The public needs to know that Congress recognizes the issue of insider trading as a problem that undermines its own legitimacy and erodes the trust of voters,” the coalition added. “The good news is that Congress is able to respond to this concern in a meaningful way by advancing S. 3494 and sending it to President Biden’s desk for his signature.”