As expected, the Senate passed a watered-down version of the STOCK Act today. We are glad to see new rules banning insider trading by MOCs. It is unseemly, not to mention unfair, for our elected officials to have a financial advantage based on inside information they have as a result of their positions. We hope the new rules are vigorously enforced.
Unfortunately, to pass any bill at all, the Senate decided it needed to drop language that would regulate shady political intelligence firms—groups that use their connections with congressional insiders to get information that they then use to make decisions about investments in the stock market. In February, by a vote of 96-3, the Senate passed a bill that would have called for disclosure by these groups. It’s disappointing that this important reform measure will not become law when the President signs STOCK Act.
The good news is that the issue isn’t dead. We understand that Senators Gillibrand and Grassley, along with a number of others from both sides of the aisle, plan to introduce a bill that would require disclosure by political intelligence firms. (Reps Walz and Slaughter have already introduced similar legislation, the Restore Public Trust Act, in the House.) The same 96 Senators who supported the original STOCK Act should support the new bill, and we will encourage them to do so. No one should be able to trade on their connections with members of Congress to gain an unfair advantage in stock market.