The STOCK Act Strengthens Disclosure Laws, Increases Transparency and Ensures that Members of Congress Play By The Same Rules as Everyone Else
Legislation Set to Receive Key Vote This Evening in U.S. Senate
Washington, DC—Today, U.S. Senators Kirsten Gillibrand (D-NY), Debbie Stabenow (D-MI), and Jon Tester (D-MT) urged support for the STOCK Act, which is set to receive a vote in the Senate this evening. The STOCK Act bars insider trading by members of Congress and their staff.
“We need to take this common sense step to begin restoring the trust that’s been lost in our government,” said Senator Gillibrand, the first member of Congress to post her official daily schedule, all earmark requests and personal financial disclosure online. “The American people need to know that their elected leaders play by the exact same rules that they play by. They also deserve the right to know their lawmakers’ only interest is what’s best for the country, not their own financial interests. Members of Congress, their families and staff shouldn’t be able to gain personal profits from information they have access to that everyday middle class families don’t. It’s simply not right — nobody should be above the rules.”
“This law makes crystal clear that Members of Congress must not be exempt from laws everyone else has to follow,” said Senator Stabenow. “Any Member of Congress abusing his or her position for personal financial gain must be held accountable. The Senate should overwhelmingly approve this bill this week, and the House should follow suit immediately.”
“The STOCK Act brings much-needed accountability to Congress and should be an easy lift,” said Senator Tester. “I don’t care if you work on Wall Street or in Congress – you should not be using privileged information to enrich yourself.”
Fact Sheet: Stop Trading On Congressional Knowledge Act (STOCK Act)
The American people deserve to know their lawmakers’ only have one interest in mind: doing what’s best for the country, not their own financial interests. The STOCK Act is a common sense, bipartisan measure that clearly and explicitly prohibits insiders trading by members of Congress and their staff. In addition, the bill strengthens disclosure laws so that members of Congress must report within 30 days when they buy or sell stocks, bonds or other securities, and must make that information available online for their constituents to see.
The STOCK Act Clearly Prohibits Insider Trading in Congress. Under the STOCK Act, members of Congress and their staff will explicitly be barred from buying or selling securities on the basis of non-public knowledge gained through their Congressional service – or from using that knowledge to tip off anyone else. It is not true that Congress has exempted itself from insider trading laws. However, some legal experts have questioned whether an insider trading case could be brought successfully against a Member because, they argue, it is not clear that members owe anyone a duty not to trade material non-public information, in the same way that, for example, a corporate executive has a duty to the company’s shareholders. The STOCK Act makes it clear that trading on non-public information would violate the duty of trust members of Congress and their staff owe their constituents by establishing a clear fiduciary responsibility. [Homeland Security and Government Affairs Committee, January 2012]
The STOCK Act Significantly Strengthens Disclosure Requirements. Currently, members of Congress annually disclose the purchase or sale of securities and commodities. The STOCK Act not only imposes a tough 30 day disclosure requirement, but also requires that the information is published online to ensure complete transparency and easy public access to the information. [Homeland Security and Government Affairs Committee, January 2012]
The STOCK Act Requires GAO To Investigate Role Of “Political Intelligence” Firms. The STOCK Act requires the Government Accountability Office to investigate the role of “political intelligence” firms, which try to learn inside information from lawmakers and their staffs and sell that information along to private clients. [Homeland Security and Government Affairs Committee, January 2012]
House Republican Leaders Blocked the STOCK Act. Majority Leader Eric Cantor ordered Financial Services Committee Chairman Spencer Bachus to cancel a publicly announced mark-up of the STOCK Act in December. “Cantor delivered the cease-and-desist order on behalf of GOP leaders, other chairmen and rank-and-file lawmakers on both sides of the aisle who were concerned that Bachus could help give the bill life by having the committee approve it.” [Politico, 12/8/11; CNBC, 12/9/11]