Tag Archives: STOCK Act

Democrat Senator Ossoff Takes On Pelosi With Possible New Legislation On Stocks

Carmine Sabia
January 9th, 2022

OPINION: This article contains commentary which reflects the author’s opinion

One Democrat senator, the youngest in the Senate, has come against House Speaker and California Rep. Nancy Pelosi on her recent comments about stock trading.

Democrat Georgia Sen. Jon Ossoff wants to ban members of Congress from being able to trade stocks when they are in their elected positions, The New York Post reported.

The Ossoff ethics bill, which the Democratic freshman Senator plans to introduce once he finds a Republican co-sponsor, would crack down on conflicts of interest by making it illegal for lawmakers and their families to trade stocks while in office, a Washington, D.C. source close to the situation said. 

It would also likely require lawmakers put their assets in blind trusts — a step that the 34-year-old Ossoff completed himself months after being elected in January 2021. 

No Senate Republicans appear to have publicly come out against congressional stock trades, so Ossoff may have trouble finding a co-sponsor in the Senate. But Republican support in the House is more likely, since several GOP House members including Texas Reps. Michael Cloud and Chip Roy have come out against the practice.

Another proposal to curb Congress trades, the Ban Conflicted Trading Act, was introduced in the Senate in March by four Democratic Senators including Sen. Jeff Merkeley of Oregon and Ossoff’s fellow Georgia freshman Raphael Warnock. It also has an accompanying bipartisan House version backed by Rep. Alexandria Ocasio-Cortez (D-NY) and Roy, among other Democrats and Republicans. 

But that legislation would only ban members of Congress and their staff from trading, which means that the husband of the House Speaker would be allowed to continue to trade stocks.

“As Speaker Pelosi’s recent transactions make clear, decisions made for the people should be separate than decisions made for personal enrichment,” Republican Rep. Chip Roy said.

“These lawmakers are just out of touch with how normal people view the situation,” Arizona Republican Senate primary candidate Blake Masters said. “Members of Congress should not be buying call options on Big Tech companies they’re in charge of regulating, that is ludicrous.”

The New York Post said that the Pelosi family has made a fortune on stocks.

And the Pelosis’ overall portfolio — which has also included companies like Disney and Roblox — beat the S&P 500 by 4.9 percent in 2019 and a whopping 14.3 percent in 2020, according to data crunched for The Post by FinePrint, an outfit pushing for greater transparency of financial holdings on both sides of the aisle. 

The Pelosis’ exposure to tech stocks, however, may have actually hurt them in 2021, when their portfolio underperformed the S&P 500 by 15.5 percent, according to FinePrint.

When asked whether the opportunity to profit on trades could create a conflict of interest, the speaker has flatly said “no” and has rejected the idea of a ban on trading individual stocks. Pelosi spokesman Drew Hammill did not dispute The Post’s findings that Paul Pelosi has generally outperformed the market but insisted that the trades are not an issue.

“The Speaker does not own any stocks,” her spokesman said. “As you can see from the required disclosures, with which the Speaker fully cooperates, these transactions are marked ‘SP’ for Spouse. The Speaker has no prior knowledge or subsequent involvement in any transactions.”

Walter Shaub, who was the director of the United States Office of Government Ethics for former Presidents Obama and Donald Trump, said that her defense is “absolutely insulting.”

“The idea that the stocks are in her husband’s name is a complete red herring,” he said. “Unless members of Congress are willing to wear microphones around the clock when they’re having dinner with their spouses and going to bed, the public has no way of knowing what information they intentionally or inadvertently shared.”

“We should be held to a higher standard,” Republican Rep. Michael Cloud said. “When the public sees people in office profiting off [stock trading] when they’re struggling, it does a great disservice to everything that this nation should be about.”

14 Members of Congress Accused of Violating Federal Law in New Report

By Abby Liebing,
December 13, 2021

A new report has found that 14 members of Congress have been violating the STOCK Act and handle their finances in a way “that could expose them to ethical problems.”

Insider reported the following Republican lawmakers were among those in the “danger” zone of financial compliance: Rep. Pat Fallon of Texas; Rep. Dan Meuser of Pennsylvania; Rep. Blake Moore of Utah; Rep. Lance Gooden of Texas; Rep. Diana Harshbarger of Tennessee; Rep. Kevin Hern of Oklahoma; Sen. Tommy Tuberville of Alabama; and Rep. Chris Jacobs of New York.

The list continued with several Democrats who had violated the STOCK Act as well: Sen. Dianne Feinstein of California; Rep. Susie Lee of Nevada; Rep. Tom Malinowski of New Jersey; Rep. Sean Patrick Maloney of New York; Rep. Kim Schrier of Washington; and Rep. Tom Suozzi of New York.

So what is the STOCK Act? An acronym for “Stop Trading on Congressional Knowledge Act,” the 2012 provision made it illegal for Congress members to participate in insider trading, Investopedia reported.

To many, it was surprising that this had to be formalized in law since many just assumed insider trading was illegal. But until 2012, “trading based on material nonpublic information — otherwise known as insider trading — was both legal and commonplace among members of Congress,” Investopedia explained.

Nine years ago, the STOCK Act made it expressly illegal. The act was widely supported in Congress, by both Republicans and Democrats. In the House, it passed 417-2 and in the Senate, it passed with a 96-3 vote.

Now at least 14 Congress members have failed to properly disclose financial trades.

“These lawmakers have violated the Stop Trading on Congressional Knowledge Act of 2012 by failing to properly disclose financial trades, many to a significant degree,” Insider reported.

“Some also employ senior staff members who’ve violated the STOCK Act or haven’t themselves taken proactive steps to avoid potential conflicts of interest,” the outlet found.

Perhaps the most prominent member of Congress listed among the 14 is Feinstein.

The senator violated the STOCK Act one time, which totaled about $15,000. She said that she paid the fine for not disclosing her trade, but did not provide any proof.

Schrier violated the act once, totaling at least $500,000. Schrier did not comment or confirm whether the fines had been paid.

Other members of Congress reportedly violated the STOCK Act over 100 times.

Fallon had 118 late disclosures, which totaled about $9,113,000.

“Upon learning of his STOCK Act violation, Congressman Fallon self-reported himself to the Ethics Committee and proactively paid his fines. The congressman has not been late on reporting stock transactions since his discovery of his first infringements,” Austin Higginbotham, Fallon’s communications director, said in a statement.

Suozzi violated the STOCK Act about 300 times, which resulted in at least $3,200,000. Suozzi did not comment on whether he had paid the fines necessary for these violations.

The infringements regarding the STOCK Act are nothing new, though.

In September, an outside ethics group complained that seven House lawmakers didn’t disclose stock trades, NPR reported.

“The lack of accountability we’ve seen in regard to STOCK Act compliance is basically giving elected officials the green light to buy and sell stocks based on information gained from committee meetings without any transparency for their voters,” Kedric Payne, general counsel and senior director of ethics at the Campaign Legal Center, wrote in a statement.

In July, Forbes also put the spotlight on three Republican lawmakers who did not report “up to $22 million in stock trades made earlier this year” — Tuberville, Moore and Fallon.

But while the 14 members of Congress identified by Insider were the ones with very clear trading violations, Insider also shone a light on other lawmakers who did not properly report their trading.

“Insider and several other news organizations have this year identified 47 members of Congress who’ve failed to properly report their financial trades as mandated by the Stop Trading on Congressional Knowledge Act of 2012, also known as the STOCK Act,” the outlet reported.

In light of all these violations, many ethics groups and government watchdogs are pushing for fines and punishments for STOCK Act violations to be harsher.

“While lawmakers who violate the STOCK Act face a fine, the penalty is usually small — $200 is the standard amount — or waived by House or Senate ethics officials,” Insider reported.

“Ethics watchdogs and even some members of Congress have called for stricter penalties or even a ban on federal lawmakers from trading individual stocks, although neither has come to pass.”

This article appeared originally on The Western Journal.