Long-awaited legislation banning members of Congress from being able to trade individual stocks is ready to come to a vote as soon as this month, House Speaker Nancy Pelosi (D-California) said in her weekly news briefing on Wednesday.
Lawmakers have been discussing the legislation for months and made some revelations on Wednesday morning, Pelosi said. “We believe we have a product that we can bring to the floor this month,” she said, which she characterized as “exciting.”
It’s unclear what’s in the bill or how much support it will have from Congress, though the general idea does appear to have unusual bipartisan support. In the past year or so, lawmakers have introduced a wide variety of bills on the topic, all containing some form of a ban.
A ban on stock trading could go far in preventing corruption in Congress, with advocates hoping that it will help to prevent lawmakers from directly profiting from legislative decisions. Though there are regulations aimed at preventing stock-related conflicts of interest and increasing financial transparency for Congress members, such laws are often unevenly enforced or are weak enough that they still erode public trust in lawmakers.
The bills range in their scope. Sen. Elizabeth Warren’s (D-Massachusetts) suggested last year that lawmakers should ban not just members of Congress but also other top federal officials from the practice, though the current legislation will likely focus solely on members of Congress and, potentially, members of their families.
The bills also differ in their enforcement mechanisms. The bill proposed by Senators Jon Ossoff (D-Georgia) and Mark Kelly (D-Arizona) would require members and their immediate families to put individual stocks into a blind trust while they’re in office, while another bill introduced this year by Warren and Rep. Pramila Jayapal (D-Washington) would require members and their spouses to divest all individual stocks.
Violators of the Warren/Jayapal law would face a hefty $50,000 fine for each infraction, while Ossoff and Kelly’s bill would impose a fine equal to one years’ salary, which is $174,000 for members and slightly more for minority and majority leaders. Other bills, like the one introduced by far right Sen. Josh Hawley (R-Missouri), would require members to return profits made from trades to the Treasury department, which could be greater or less than the penalties under the other two bills previously mentioned.
Pelosi discussed the status of the legislation in response to a question from a reporter about a recent explosive New York Times report, which found that in recent years, nearly a fifth of Congress members have made a stock transaction involving a company in an industry overseen by committees that they are a part of, raising serious ethics concerns.
The report found that 97 members of Congress or their families, from both sides of the aisle, made stock trades between 2019 and 2021 that could represent conflicts of interest – in the case of some members, dozens of potential conflicts.
The person with the most potential conflicts was conservative Democrat and industry friendly Rep. Josh Gottheimer (New Jersey), with 43 questionable trades. Many of these were in major banking and financial corporations, despite his seat on the House Financial Services Committee.
Sen. Elizabeth Warren (D-Massachusetts) renewed her call for a stock-trading ban in Congress on Tuesday after the release of the report.
“It’s long past time to ban members of Congress and their spouses from owning and trading individual stocks. Months ago, I introduced the only bipartisan bill in the Senate to get it done,” she wrote on Twitter. “Congress urgently needs strong reform here — no more delays.”
Indeed, lawmakers have been introducing stock bans since the beginning of this year, but the proposal has seen relatively little movement despite being vastly popular among the public. Lawmakers in favor of the ban have suggested that Pelosi could be part of the reason for the delay; in the spring, Rep. Abigail Spanberger (D-Virginia) said that she thinks Pelosi and Senate Majority Leader Chuck Schumer (D-New York) are “trying to run out the clock” on the proposal.