A bipartisan bill introduced by Reps. Alexandria Ocasio-Cortez (D-NY) and Matt Gaetz (R-FL) seeks to ban members of Congress from trading individual stocks. The Bipartisan Restoring Faith in Government Act would require members of Congress, their spouses and dependents to divest any stocks they currently hold or place them in a blind trust within 90 days of passage.
Similar measures have been proposed in the past but failed. Significant bipartisan support for the issue grew last year, but bills to ban or limit the issue were never brought to the floor for a vote in either chamber, according to Axios.
The move follows a steady drip of headlines and mounting public anger that has been building since the pandemic, when some lawmakers were caught buying and selling millions of dollars worth of stock after being warned about the coming disruption from the virus, according to the Associated Press. The pandemic’s arrival tanked markets and caught many Americans by surprise.
Meanwhile, the collapse of First Republic Bank has brought new scrutiny to the issue. Recent disclosures show that Rep. Lois Frankel (D-FL) dumped First Republic stocks prior to its collapse. She then purchased JP Morgan stock before JP Morgan purchased First Republic, per the disclosures.
Frankel told CNN that her account is “managed independently by a money manager who buys and sells stocks at his own discretion.” Congresswoman Frankel is not facing any investigations as of press time.
A September analysis by The New York Times found that dozens of members of Congress bought or sold stock, bonds, or other financial assets that intersected with their congressional work.
Members of Congress are not banned from investing in any company.
The 2012 STOCK Act, however, makes it illegal for members of Congress to knowingly trade, buy or sell stocks based on material information obtained in their official capacity in Congress. The law also requires members of Congress file timely financial reports disclosing their trades.
Government ethics experts have said the patterns of certain trades underscore longstanding concerns about the potential for conflicts of interest.
