When Peter Schweizer uncovered evidence of insider trading by Republican chairman of the House Financial Services Committee Spencer Bachus (R-AL), and 60 Minutes reported on it, I was the first person to call for Rep. Bachus to resign.

That was November 14, 2011.

Now, with news that the Office of Congressional Ethics has launched an insider trading investigation of Rep. Bachus, among possible others, I once again call on the Alabama Republican to do the right thing and leave Congress for good.

At the historic moment when the American people were looking to their elected leaders to protect them and their families’ portfolios, Rep. Bachus was busy using nonpublic information to enrich his own portfolio. In the summer and fall of 2008, Spencer Bachus’s position as the ranking Republican on the House Financial Services Committee gave him access to high-level private meetings and conversations with the then-Treasury Secretary Henry Paulson and other senior officials. The meetings Bachus was privy to were so secretive that those in attendance were not even allowed to bring cell phones into the meetings so as to prevent sensitive information that could threaten our nation’s financial system from leaking out.

And what did Congressman Bachus do with such trust and responsibility?

From July to November 2008, Bachus executed at least 40 well-timed, highly risky options trades throughout the turbulent period that netted him as much as $50,000 in capital gains. As Americans were losing their life savings, Bachus was padding his. (more…)

Rep. Spencer Bachus (R-AL), whose financial transactions while ranking member of the House financial services committee were exposed by Breitbart editor Peter Schweizer, is now the target of an insider trading inquiry by the Office of Congressional Ethics, according to the Washington Post:

The Office of Congressional Ethics is investigating the chairman of the House Financial Services Committee over possible violations of insider-trading laws, according to individuals familiar with the case.

Rep. Spencer Bachus (R-Ala.), who holds one of the most influential positions in the House, has been a frequent trader on Capitol Hill, buying stock options while overseeing the nation’s banking and financial services industries.

The Office of Congressional Ethics, an independent investigative agency, opened its probe late last year after focusing on numerous suspicious trades on Bachus’s annual financial disclosure forms, the individuals said. OCE investigators have notified Bachus that he is under investigation and that they have found probable cause to believe insider-trading violations have occurred.

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(Reuters) – The House of Representatives overwhelmingly passed on Thursday a bill to curb insider trading by lawmakers and other government officials, despite objections from both Democrats and Republicans that it was weaker than a version passed by the Senate last week.

The House voted 417-2 to pass the Stop Trading on Congressional Knowledge (STOCK) Act, even though it did not include a provision to impose new regulations on Washington insiders who collect “political intelligence” from lawmakers and sell it to Wall Street. The Senate version included this proposal.

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The Senate voted 96 to 3 Thursday to prohibit members of Congress from using non-public information for personal financial gain but beat back a slew of amendments to further limit congressional perks.

The Senate action puts pressure on House Republicans to pass similar legislation to quell allegations of congressional self-dealing at a time when Congress’s approval rating is at an all-time low.

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Democrats controlled all three branches of government for the first two years of President Barack Obama’s presidency and did nothing to advance congressional insider trading reform. Indeed, former Speaker of the House Nancy Pelosi (D-CA) and Sen. John Kerry (D-MA) have been cited as among Congress’s worst abusers of using nonpublic information to influence their private stock trades. And until his State of the Union speech last week, President Obama had said nothing publicly about the issue–ever.

But now, in the wake of Breitbart editor Peter Schweizer’s blockbuster bestselling insider trading expose, Throw Them All Out, and the 60 Minutes report the book sparked, Mr. Obama and his campaign team have begun co-opting the insider trading issue, first in Mr. Obama’s State of the Union speech and now in a new campaign email blasting House Republicans for inaction on the issue and praising the Democratic leadership of Sen. Harry Reid (D-NV) in the Senate.

The Obama-Biden email, with a subject line titled “This isn’t already illegal? Email from O’camp,” reads:

Right now, members of Congress can make personal investment decisions based on confidential information they get in the course of regulating industries and doing their work.

It’s kind of unbelievable that this isn’t already illegal. President Obama wants to make it illegal once and for all — no one should profit from inside information about the very businesses they’re supposed to be regulating.

Today, the Democratic leadership in the Senate voted to move forward on a bill to extend to Congress the same strict rules that apply to anyone else whose job gives them access to sensitive information about businesses. This legislation is expected to pass the Senate with bipartisan support later this week.

But Republicans in the House have yet to move on it.

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In the wake of Monday’s bipartisan 92-3 Senate vote to take up legislation that would ban members of Congress and their staffs from profiting from the use of nonpublic information when investing, freshman Congressman Sean Duffy (R-WI) believes the much-discussed STOCK (Stop Trading On Congressional Knowledge) Act contains significant flaws that render the measure a largely symbolic gesture.

“The truth is, there are loopholes in that bill [the STOCK Act] you can drive a truck through,” said Rep. Duffy in an interview with Big Government.

A far better solution, says Rep. Duffy, would be to pass the bill he has introduced known as the RESTRICT (Restoring Ethical Standards, Transparency, and Responsibility in Congressional Trading) Act, which has been endorsed by the person responsible for spearheading insider trading reform, Breitbart editor Peter Schweizer, author of Throw Them All Out.

The RESTRICT Act’s strength, say supporters, lies in its simplicity: the bill would require all members of Congress to either place their assets in a blind trust or submit to a three-day public disclosure requirement for any and all investments.

Rep. Duffy believes that the RESTRICT Act’s straightforward approach solves at least three significant weaknesses found in the STOCK Act.

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Breitbart editor Peter Schweizer’s battle against congressional insider trading will enter a critical phase this week as the Senate is set to vote on a bill banning members of Congress from using material, nonpublic information to make private investments.

From USA Today:

Aware that most Americans would like to dump them all, members of Congress hope to regain some sense of trust by subjecting themselves to tougher penalties for insider trading and requiring they disclose stock transactions within 30 days.

A procedural vote Monday would allow the Senate later this week to pass a bill prohibiting members of Congress from using nonpublic information for their own personal benefit or “tipping” others to inside information that they could trade on.

The Senate is considering passage of the STOCK (Stop Trading On Congressional Knowledge) Act, which would ban members of Congress and their staffs from engaging in insider trading and would include a 30 day reporting requirement on all investments.  The Senate version of the bill is cosponsored by Sens. Scott Brown (R-MA) and Kirsten Gillibrand (D-NY).  Prior to Peter Schweizer’s book Throw Them All Out and the 60 Minutes report based on his book, the STOCK Act had only four cosponsors in Congress.   Now, the bill has 230 cosponsors.

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WASHINGTON (AP) – Aware that most Americans would like to dump them all, members of Congress hope to regain some sense of trust by subjecting themselves to tougher penalties for insider trading and requiring they disclose stock transactions within 30 days.

A procedural vote Monday would allow the Senate later this week to pass a bill prohibiting members of Congress from using nonpublic information for their own personal benefit or “tipping” others to inside information that they could trade on.

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Rep. Spencer Bachus (R-AL), who was the subject of allegations of congressional insider trading, has indicated that he will not seek to extend his term as chair of the House Financial Services Committee after 2012.

Bachus was one of several Capitol Hill leaders from both parties involved in insider trading, according to Breitbart editor Peter Schweizer, who raised the issue in his recent book, Throw Them All Out. Subsequently, President Barack Obama called on Congress this week to pass a law banning congressional insider trading–though the book also documented crony capitalism in the Obama administration’s green energy programs.

Bachus could have sought a waiver from the Republicans Party’s self-imposed six-year term limit on committee chairs, which includes time spent leading the minority as ranking members. However, he chose not to do so, though he has indicated that he wishes to play a role in selecting his successor.

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In a recent op-ed by Rep. Sean Duffy (R-WI), the freshman congressman said that while efforts such as the STOCK (Stop Trading On Congressional Knowledge) Act designed to stop members of Congress were commendable, ultimately, they will not work as intended.

Writing in the Wisconsin Rapids Tribune, Rep. Duffy said:

A few months ago, Breitbart News editor and author Peter Schweizer published a book titled Throw Them All Out which suggested that members of Congress were using their influence and access in the legislative process to fatten their investment portfolios.

A 60 Minutes piece followed which brought the issue to national attention and rightly caused Americans to wonder: “Is my representative using the power I’ve entrusted in him for personal gains in the stock market?”

As one of the 87 freshman legislators sent to Washington to clean up the mess, I think we owe it to the American people to do just that: clean up the mess. And that includes the reputation and perception that members of Congress operate above the law. Congress ought to hold itself to a higher standard.

Rep. Duffy says that while he personally has not seen any of his congressional colleagues engage in insider trading, he considers it the better part of reason to remove the possibility for the practice to occur. To accomplish that, writes Rep. Duffy, Congress must pass the bill he recently introduced, the RESTRICT (Restoring Ethical Standards, Transparency and Responsibility in Congressional Trading) Act:

The RESTRICT Act is the only way to stop any real or perceived insider trading by members of Congress.

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President Obama’s plea to ban Congressional insider trading may poll well and have bipartisan support, but it’s already facing stiff resistance from lawmakers the morning after his State of the Union address.

On Tuesday night, the president spoke in no uncertain terms: “Send me a bill that bans insider trading by Members of Congress, and I will sign it tomorrow,” he said. “Let’s limit any elected official from owning stock in industries they impact.” The remarks were cause for celebration for Breitbart editor Peter Schweizer, who authored a 2011 book exposing Congressional insider trading, and 60 Minutes, which ran a widely-viewed segment based on his book (CBS quicklyuploaded the portion of the speech last night). But early reactions from Congress (Republicans and Democrats) shouldn’t encourage much optimism.

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In a State of the Union speech devoid of clarity or specifics, President Barack Obama offered but one shining exception: a direct call for members of Congress to send him a bill to ban congressional insider trading.

“Send me a bill that bans insider trading by members of Congress and I will sign it tomorrow,” President Obama said to applause. “Let’s limit any elected official from owning stock in industries they impact.”

Since the release of “Throw Them All Out,” Breitbart editor Peter Schweizer has been a one-man battalion fighting for members of Congress to abide by the same insider trading laws that apply to all Americans.   President Obama’s speech Tuesday night is evidence that Schweizer’s battle against congressional insider trading and cronyism has scored a critical victory.

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Let me build on Charles Krauthammer’s great Friday column, “The GOP’s Suicide March.” Krauthammer argues that just as President Obama’s class-warfare, soak-the-rich mantra started lagging in the polls, some Republicans on the campaign trail started making the case that Mitt Romney’s Bain Capital was involved in nothing more than vulture capitalism, looting companies, and destroying jobs. Keeping class envy alive.

I’m not going to name names, because everybody knows who these Republicans are. Instead, I want to go positive, and commend Mitt Romney himself. Romney did his best in the second South Carolina debate to fight for free-market capitalism and Adam Smith, and against the spread of Obama-style crony capitalism and class envy.

During the Thursday night debate, Romney launched this:

“You’ve got to stop the spread of crony capitalism. [Obama] gives General Motors to the UAW. He takes $500 million and sticks it into Solyndra. He stacks the labor stooges on the NLRB so they can say no to Boeing and take care of their friends in the labor movement. . . . He has to bow to the most extreme members of the environmental movement. He turns down the Keystone pipeline, which would bring energy and jobs to America.

“My view is capitalism works. Free enterprise works. . . . There’s nothing wrong with profit, by the way. That profit went to pension funds, to charities. It went to a wide array of institutions. . . . And by the way, as enterprises become more profitable, they can hire more people. I’m someone who believes in free enterprise. I think Adam Smith was right. And I’m gonna stand and defend capitalism across this country, throughout this campaign. I know we’re going to get hit hard from President Obama, but we’re gonna stuff it down his throat and point out that it is capitalism and freedom that makes America strong.”

Whoa. Tough stuff. The right stuff.

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Alabama State Senator Scott Beason (R-AL) announced his candidacy for Alabama’s 6^th Congressional district late last week against 10-term incumbent, Spencer Bachus (R-AL).  This comes on the heels of multiple accounts of corruption exposed initially in Peter Schweizer’s best selling book, “Throw Them All Out.”

Since Schweizer’s book came out, CBS’ 60 Minutes did a feature on Congressman Bachus’ insider trading, and that of others.  Since then, his own constituents held a rally demanding Bachus’ resignation.  In response, he committed to hold hearings on the STOCK Act, an effort to reform insider trading.  Later, the Congressman reneged.

His constituents reacted angrily, committing to recruit a strong candidate against the Congressman, and many names were floated.  Just after Christmas, Judicial Watch named Bachus one of the top 10 most corrupt politicians in Washington.

“This (Spencer Bachus) is clearly not proper representation of the good people of Alabama” said Deanna Frankowski, of Rainy Day Patriots, a local Tea Party group.  “I told Scott Beason that we need his leadership against Bachus, and that I would help him if he ran.”

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At an event Wednesday in Rock Hill, South Carolina, former Speaker of the House Newt Gingrich drew applause from the crowd when he called the congressional insider trading scandal uncovered by Breitbart editor Peter Schweizer and a report by 60 Minutes a “good example of a bipartisan mess.”

Mr. Gingrich said he favored a law requiring members of Congress to place all their assets in a blind trust and to submit to a three day reporting requirement on any and all investments.  Although the former Speaker of the House did not refer to it by name, a bill proposed by freshman Congressman Sean Duffy (R-WI) called the RESTRICT (Restoring Ethical Standards, Transparency, and Responsibility in Congressional Trading) Act would do precisely as Mr. Gingrich proposes.

As the Wall Street Journal reports:

Mr. Gingrich said it is wrong for lawmakers to be able to buy and sell stocks based on information they learn in their government jobs. He laid part of the blame on campaign finance rules that favor wealthier candidates for Congress who can afford to pay for their own elections. As a result of those rules, a larger share of lawmakers in both parties come to Congress with extensive financial portfolios.

Mr. Gingrich’s recent statements echo those he made in November when he declared his support for applying the same insider trading laws that apply to private citizens to members of Congress.

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On today’s edition of Coffee and Markets, Pejman Yousefzadeh and Kevin Holtsberry are joined by Peter Schweizer to discuss his book Throw Them All Out detailing how politicians get away with insider trading, sleazy land deals and more.

We’re brought to you as always by BigGovernment and Stephen Clouse and Associates. If you’d like to email us, you can do so at coffee[at]newledger.com. We hope you enjoy the show.

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An online petition to ban congressional insider trading has collected 4,488 online signatures.

The petition was started by Rick Smith, a financial writer for the popular investing website The Motley Fool.

For years, Mr. Smith has been championing legislation that would stop members of Congress from profiting off of private information.   Given the head of steam his online petition supporting the STOCK (Stop Trading On Congressional Knowledge) Act appears to be gathering, that’s a message that’s beginning to break through.

Even if the STOCK Act or similar bills on the issue pass, Mr. Smith thinks members of Congress should go farther to ensure public transparency:

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Gov. Rick Perry is making a ban on congressional insider trading a central theme of his presidential campaign.

In an op-ed published yesterday with RedState.com, Gov. Perry wrote:

Earlier this week, the Chicago Tribune ran a little noted editorial on the insider trading scandal plaguing Congress, calling out phony efforts to reform the rules and demanding that we finally put a stop to this outrageous and unethical behavior.

If you haven’t read the editorial yet, I recommend you do because while the professional political punditry class is more interested in superfluous items like the political horse race and candidate attire, the reality is that members of both parties in Washington, D.C., are abusing their positions and ordinary Americans have had enough.

The Chicago Tribune article to which Gov. Perry refers was analyzed in a featured story by Breitbart News yesterday.

As Gov. Perry makes clear in his op-ed:

It’s not enough members of Congress make $174,000 a year, some are trading on inside information to use their public service to enrich themselves.

The Tribune is right, the Securities and Exchange Commission and Justice Department should be using every available tool to put a stop to this.  But they are not.  So, Congress needs to pass the STOCK Act as a matter of urgency, to do even more to ensure that this kind of thing is stopped dead in its tracks.

This is not the first time Gov. Perry has stated his support for ending the use of material, nonpublic information by members of Congress when investing.   In November, Perry cut a campaign commercial on this issue.

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The Chicago Tribune editorial page believes that legislative efforts to ban congressional insider trading, such as the STOCK (Stop Trading On Congressional Knowledge) Act, are simply an exercise in “damage control” and “window dressing” to shield Rep. Spencer Bachus (R-AL) and others mentioned in a 60 Minutes investigative report, based on Breibart News editor Peter Schweizer’s bestselling book, Throw Them All Out.

From the Chicago Tribune:

The measures under consideration strike us as window dressing. We suspect the push for new rules is about protecting the reputations of Bachus and others spotlighted in the news.It sure does seem that being a member of Congress carries benefits beyond the salary. The New York Times reported this week that the median net worth of the members rose 15 percent from 2004 to 2010, when the median net worth for all Americans dropped 8 percent.

But spare us a phony effort to “reform” the rules. The public won’t buy it. And the public has even greater reason to be disgusted with Congress, starting with a national debt of $15 trillion and climbing.

A Breitbart News exclusive report revealed that Rep. Spencer Bachus’s options trading records during the summer and fall of 2008’s debates over the Troubled Asset Relief Program (TARP) were curiously well-timed with market trends.  Specifically, from July to November 2008, Rep. Bachus executed at least 40 options trades that resulted in as much as $50,000 in capital gains.   As Peter Schweizer revealed, Rep. Bachus’s position as the Chairman of the House Financial Services Committee gave him access to high-level private meetings and phone conversations with then-Treasury Secretary Henry Paulson, as well as other senior financial officials.

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As the Tea Party looks to codify and push its 2012 legislative and electoral agendas, a recent editorial by the Washington Examiner argues that the Tea Party would do well to make combating congressional insider trading its marquee legislative issue.

In a piece titled, “Tea Party ‘Outsiders’ Should Raise Hell About Insider Trading by Lawmakers,” the Washington Examiner’s editorial board argues that regardless of what happens with bills like the STOCK (Stop Trading On Congressional Knowledge) Act or the recently introduced RESTRICT (Restoring Ethical Standards, Transparency, and Responsibility in Congressional Trading) Act, Tea Party members of Congress can still take action by bringing complaints to the Ethics Committee.

From the Washington Examiner:

[Members of Congress] and members of their staffs are free to make millions on information they get by virtue of being in Congress, whether ordinary citizens like it or not.

That doesn’t mean, however, that complaints cannot be brought against them with the House and Senate ethics authorities for abusing the public trust or creating the appearance of conflicts of interest. And that raises an interesting question, particularly for Tea Party members of Congress: Why haven’t they filed such complaints, if for no other reason than to further highlight the hypocrisy of congressional ethics enforcement? Dozens of those Republicans who were elected in 2010, supposedly as “outsiders,” have been strangely quiet on this issue. What other issue more effectively illustrates the need to, as Schweizer pungently puts it, throw them all out and rid Congress of the stench of corruption?

Tea Party Republicans in Congress have also expressed frustration at their inability to reform federal spending, debt and entitlements. Their impatience is understandable, but the Constitution wisely forces reform movements like the Tea Party to win successive elections. Doing that requires continuously reminding voters of what must be done to fix things. Filing ethics complaints and publicizing them at every opportunity would serve that purpose admirably.

What’s more, writes the Examiner, the delays–some would say foot-dragging–over the complexities and intricacies of banning congressional insider trading are just that: dilatory tactics designed to muddle the issue and whisk it under the national carpet.

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