Senators Announce 'Historic Step Forward' On Congressional Stock Trading Ban

A bipartisan group of U.S. Senators announced a deal for a congressional stock trading ban at a press conference on Wednesday.

What Happened: Senators Gary Peters (D-MI), Jeff Merkley (D-OR), Josh Hawley (R-MO) and Jon Ossoff (D-GA) announced the initiative at a press conference on Wednesday, according to CPRNews.

The law would prohibit members of Congress from buying stocks and selling stocks 90 days after the bill is signed. It would also ban member spouses and children of members of Congress from trading stocks starting in March 2027, Axios reported.

The law would also dissuade violation: penalties would be a month’s salary or 10% of the value of the asset bought or sold according to Axios.

The bill will be marked up by the Homeland Security and Governmental Affairs Committee later this month.

Peters, who chairs the committee, called the legislation a “historic step forward” in the press conference.

See Also: Marjorie Taylor Greene Buys Cybersecurity Stock Owned By Nancy Pelosi

Why it Matters: Members of Congress often trade financial securities, drawing criticism from those disturbed by potential conflicts of interest. Policymakers can vote on legislation that could materially affect the stocks they own.

Former House Speaker Nancy Pelosi (D-CA) receives substantial attention — and condemnation — from the markets for her frequent trades. An ETF tracking Pelosi’s trades has outperformed the S&P 500 in 2024.

Will it Pass?: To become law, the bill must pass through the committee, pass both legislative chambers, and be signed by President Joe Biden.

While Wednesday’s press conference demonstrated bipartisan interest in the Senate, the bill would also have to pass the U.S. House of Representatives. A potential ban already has support from several members of the House.

Congressman Ro Khanna (D-CA) told Benzinga in May that he supports a ban, calling the actions of his colleagues who profit from financial markets “shameful.”

A group of 20 representatives signed a letter on Tuesday urging Speaker of the House Mike Johnson (R-LA) and Senate Majority Leader Chuck Schumer (D-NY) to fast-track legislation.

Per the letter, a ban on congressional stock trading could be a rare, unifying policy in a country fraught with polarization; 86% of Americans support a ban according to the University of Maryland School of Public Policy.

Biden has been mum on the issue; in a 2022 press conference, ex-press secretary Jen Psaki said that Biden would “let members of leadership in Congress and members of Congress determine what the rules should be” without staking an official position, according to CNBC.

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