A new Senate bill aims to ban Congress members from trading individual stocks, addressing concerns over insider trading and fair market practices.
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A group of Senators have just proposed a new bill that would ban members in Congress from trading individual stocks. Current laws require members of Congress to disclose when they trade individual stocks, but critics say that this is rarely enforced and not sufficient enough. The public has seen trades be highly successful by Congress members knowing information the public does not. Major concerns around this topic are growing, as a fair market is not seen with Congress members having access to information prior to the public's knowledge, allowing trades to be made in favor of profitability based on new laws/bills coming into place.
Insider trading laws apply to lawmakers, but after the 2009 financial crisis several lawmakers made enormous amounts of money after trading financial stocks before the banks were capsized. These trades of course came to light as congress members were profiting off information they would learn on congressional committee hearings. Whether or not this is from insider trading, the public is shining a light on whether “early information” can be categorized as insider trading.
If the bill is passed, by 2027 lawmakers will be required to stop investing in individual stocks. Many state that Congress should not be in office to make money, but should be here to serve the purpose of the American people. The bill is expected to have the support of many, as current penalties of not following the Congress trading rules in place today, face a fine of only $200.
