Stop Insider Trading Act

Key Points

• This bill would ban Members of Congress, their spouses, and dependent children from purchasing individual stocks while in office. The goal is to prevent lawmakers from profiting off private information they gain through their government roles.
• Lawmakers who want to sell stocks they already own must publicly disclose their intent at least 7 days (and no more than 14 days) before the sale, including the number of shares and projected sale date. These notices would be posted on official congressional websites.
• Common pooled investments like mutual funds, index funds, and diversified investment vehicles are exempt. Small business interests and qualified blind trusts where the lawmaker has no control over the trustee are also excluded.
• Violations carry a fee of $2,000 or 10% of the transaction value, whichever is higher, plus any profits made on the illegal trade. Members must also sell any stock purchased in violation of the ban.
• Lawmakers cannot pay these fines using taxpayer-funded office budgets or campaign donations — the penalty must come out of their own pocket. Members who resign or retire before paying can be referred to the Department of Justice.
• If enacted, the new restrictions would take effect 180 days after signing, giving members and their families roughly six months to restructure their portfolios or move holdings into compliant vehicles like blind trusts or diversified funds.

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