WASHINGTON—An issue in Congress is once again bringing together progressive House Democrats and Freedom Caucus-aligned House Republicans in support of new legislation.
The issue? The trading of stocks by members of Congress. In recent years, several senators and representatives have been the subject of critical reports regarding stock trades they’ve personally undertaken, yielding handsome profits shortly before market-sensitive news.
Insider trading by members of Congress and their staff is already prohibited, and they are required to report any stock purchase to congressional authorities within 45 days of the transaction, per the Ethics in Government Act. Still, members routinely have access to sensitive and even classified information that could indirectly influence markets, which some lawmakers say gives them the ability to unfairly profit from their government service.
Several dozen members of the House have co-sponsored the “Transparent Representation Upholding Service and Trust (TRUST) in Congress Act,” which would ban members of Congress, their spouses, and dependent children from stock trading in its entirety. The legislation has the largest number of co-sponsors among several bills that have been introduced for this purpose.
The TRUST in Congress Act would require members of Congress to place their stock holdings into a blind trust for the duration of their elected service. The bill does not specify any penalties for non-compliance.
Efforts to ban stock trading by members have been repeatedly attempted in multiple Congresses, though none have ever received a final vote in either the Senate or House of Representatives. In both chambers, the party leadership effectively controls the placement of bills on the floor and can prevent legislation from being considered.
In the Senate, a previous effort to ban stock trading by members of Congress was led by Sen. Josh Hawley (R-Mo.), who introduced a bill with Sen. Gary Peters (D-Mich.) during the 118th Congress, though it was never passed by the full body.
The bill has not been reintroduced in the 119th Congress.
Even as polling shows that many voters favor such bans, there is opposition in Congress. Hawley’s legislation, when considered at the Senate Homeland Security and Governmental Affairs Committee in July 2024, received ‘Nay’ votes from Sens. Ron Johnson (R-Wis.), Rand Paul (R-Ky.), and James Lankford (R-Okla.). None have released a public statement about their vote against the bill.
Other branches of government have ethics rules requiring divestment of assets or the creation of blind trusts to prevent conflicts of interest. Supreme Court justices and other federal judges are permitted to hold individual stocks but are required to recuse themselves from cases involving those companies.
In the executive branch, officers may also hold stock but cannot work on issues involving those companies, with criminal penalties for non-compliance. Only the president and vice president are exempt from such conflicts.
The offices of Hawley and Pelosi did not immediately respond to a request for comment.
