Debate on tighter restrictions for member stock trading has become a popular topic on Capitol Hill, but a lack of consensus in the House on how to proceed makes it unclear what, if anything, will be done.
When senators sold off loads of stock at the beginning of the coronavirus pandemic after nonpublic briefings in early 2020, the perceived impropriety of those trades raised questions about whether members should be allowed to trade individual company stock and even beyond that. Those questions have been reenergized by Insider’s reporting that found many members of Congress weren’t properly reporting their trades in violation of the Stop Trading on Congressional Knowledge (STOCK) Act of 2012, a law designed to prevent insider trading through disclosure requirements.
Members are required to disclose certain securities transactions over $1,000 made by them, their dependent spouse or their children no later than 45 days after the trade execution. These periodic transaction reports are not required for widely held investment funds such as mutual funds or exchange-traded funds. If a transaction is not reported on time, the penalty for late transactions is $200.
