The bill: On Tuesday, Sen. Josh Hawley (R-Mo.) introduced the “Preventing Elected Leaders from Owning Securities and Investments” (PELOSI) Act. Hawley said his bill is directed to “ban stock trading & ownership by members of Congress” and further prevent them from “using their position to get rich on the stock market.”
If passed, the PELOSI Act would amend the Ethics in Government Act of 1978 to prevent insider trading in Congress by:
- Requiring members of Congress and their spouses to get rid of stock holdings or put them in a blind trust.
- Requiring the Government Accountability Office to conduct an audit of the finances of each member of Congress.
Where is this coming from? Hawley’s bill is in reaction to revelations that Nancy Pelosi and her husband had utilized her position as Speaker of the House to strengthen their personal investment portfolio. Pelosi recently disclosed a sale of as much as $3 million in Google stock nearly a month prior to the federal government opening an anti-trust lawsuit against the company. Between 2007 and 2020, Pelosi and her husband’s stock portfolio value inflated by as much as $30 million.
A recurring problem: Previously enacted laws, such as the STOCK Act of 2012, have similarly sought to crack down on insider trading in Congress. However, the bill only required members of Congress to report stock transactions of $1,000 or more within 45 days. So, while the STOCK Act has provided greater transparency, as Pelosi’s actions prove, transparency alone is not enough to prevent corruption.