Thread: House Bill Would Ban Insider Trading in Congress

House Bill Would Ban Insider Trading in Congress

Monday, July 13, 2009 2:10 PM

WASHINGTON -- Members of Congress and their aides would be banned from making securities trades using information they gained through their jobs under legislation its sponsors say has taken on new urgency as the government spends billions bailing out companies.

The bill proposed by Democratic Reps. Louise Slaughter of New York and Brian Baird of Washington would require lawmakers and their staff to disclose within 90 days the purchase or sale of stocks, bonds or commodity futures exceeding $1,000, except for transactions in blind trusts or mutual funds. Members of Congress currently must report their financial holdings and securities transactions in ranges of amounts once a year.

Slaughter and Baird are slated to testify on the proposal at a hearing Monday of the House Financial Services subcommittee on oversight. Slaughter is chairman of the House Rules Committee. Also scheduled to appear is David Kotz, inspector general of the Securities and Exchange Commission, whose office examined frequent stock trades by two SEC enforcement attorneys in a position to receive sensitive information about agency probes of public companies.

Federal prosecutors and the FBI have been investigating the SEC attorneys' transaction for possible illegal insider trading.

Slaughter and Baird say lawmakers often get early access to sensitive information that can significantly affect stock prices or the overall market, and should be subject to prohibitions against insider trading in the same way as officers and directors of public companies.

"If it's wrong in the corporate world, it's wrong in the government," Baird said in a telephone interview Monday.

Instances of improper insider trading by lawmakers appear few and difficult to recall, yet Baird said he believes "it's almost certainly happened."

"It's too enticing a a target," he said.

A 2004 study by Georgia State University showed that U.S. senators got returns on their investments that were about 25 percent higher than what average Americans earned.

With tens of billions of taxpayer dollars going to bail out big financial companies and automakers in the economic crisis, concern over congressional integrity is heightened, Baird said. Bank of America Corp., Citigroup Inc., General Motors Corp. and JPMorgan Chase & Co. and have been among the bailout recipients.

The latest congressional disclosure reports this spring showed that lawmakers, including those sitting on the House and Senate committees overseeing the financial bailout, had substantial holdings in the big banks that received rescue funds.

The bill also would prohibit people outside Congress from buying or selling stocks, bonds or commodity futures using nonpublic information obtained from someone in Congress or the executive branch of the government. Firms specializing in "political intelligence" that get their information directly from Congress would be required to register and file disclosure reports with the House and Senate like lobbying firms do.

Prospects for the legislation are unclear.

In the SEC case, Kotz found that the agency "has essentially no compliance system in place to ensure" that employees don't engage in insider trading.

http://www.newsmax.com/politics/us_insi ... 34933.html

I wonder if the legislation will extend to stopping Gore, Waxman, Reid, Pelosi and many others from collecting on their investments in "Green Energy" while they voted for and promoted the "Cap and Crap" tax.

We have many examples of this type of corruption in the Kenyan's Washington, anyone on the post know the name of the politicians whose relative is a big shot for Monsanto so they are trying to pass the health and safety act to stop us from growing our own food to help make Monsanto even wealthier?