Rep. Sean Duffy Says STOCK Act ‘Doesn’t Go Far Enough’ to End Congressional Insider Trading
by Wynton HallIn 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.
Other members of Congress have introduced similar pieces of legislation such as the STOCK Act, which requires members to disclose $1,000 trades within 90 days. While I commend their efforts, the truth is that the STOCK Act doesn’t go far enough and, frankly, has loopholes you can drive a truck through. For example, under the STOCK Act, a member of Congress could trade a total of $50,000 in one day by making 50 trades at $950 per trade and never trigger the reporting requirement.
In contrast, the RESTRICT Act is simple and straightforward — a refreshing change for a Congress accustomed to huge bills with carve-outs and loopholes to avoid the very practice the bill was intended to prevent.
Breitbart editor Peter Schweizer, who is widely regarded as the individual most responsible for spearheading the congressional insider trading reform movement, says he believes the RESTRICT Act is a superior solution to the problem and that he prefers it over the STOCK Act. About the RESTRICT Act, Mr. Schweizer says:
The RESTRICT Act is by far the best way to start addressing the problems of insider trading in Congress. It provides a simple transparent and direct approach that will help the American people hold their elected leaders more accountable
According to Rep. Duffy, the RESTRICT Act will begin restoring much-needed transparency and accountability among members of Congress.
It’s time Congress led with the transparency and accountability worthy of our office. In an age of dysfunctional government and growing public cynicism, the RESTRICT Act is one of those rare bills that can help restore confidence in government and unite commonsense Americans on both sides of the aisle. What citizen doesn’t want to limit corruption and make sure Congress is working in the best interest of the people who elected them?
Let’s work together to restore high ethical standards in Congress — please share this column with your friends today. Help me spread the word about how we can “go all the way” to end Congressional insider trading by passing the RESTRICT Act.
With Congress resuming this week, House members are expected to quickly take up debate on STOCK Act and Rep. Duffy’s RESTRICT Act.
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40 Comments
Come on guys!
You didn't expect them to really end it , did you?
They have to leave enough loopholes and latitude, so that they can continue business as usual. After all, this is what generates their real retirement package. The pensions and perks that they get from US is mere window dressing.
They should all be forced to put all of their investment money in Fannie and Freddie, then maybe they would work to make them better.
Is it becoming clear yet why these people spend millions to get elected to a $150k per year job……?
To use a quote from the Bush-Gore election cycle of 2000: Fuzzy math……. http://www.youtube.com/watch?v=F9pqmW-D14I
It seems like a million years ago.
The solution- Absolutly no trading in ANY markets, including Real Estate, while serving in Congress. Term limits without a Constitutional Amendment……Perfect…!!!
A binding, strictly enforced blind trust requirement is the only way to go. Good on ya, Congressman Duffy.
Morning Cowboy,
Did you see this, seems O signed an executive order with a global coalition for other countries to be able to shut down websites here. This has flown under the radar and it is time people knew what he was doing behind the curtain:
http://www.gather.com/viewArticle.action?articleI...
We all knew he was going to do anything and everything to shut down the 1st Amendment, well, here it is.
The tax revenue plus proceeds from borrowing is a huge pot of gold that the real power seekers cannot resist. They want to divvy it up at their discretion while reserving a substantial amount for themselves. Repeal the income tax. It is evil to gain even more of a man's earnings if that man works harder. The mafia invented the technique and Congress liked it so well, they amended the Constitution to allow what our founding fathers prohibited. It is theft. Dry up the money stream and Washington will clean itself. Kind of like self-deportation (G).
Members of the Government as a whole must put all assets in a totally blind trust.
They are not to even know the name of the asset manager. Any violation to result in a mandatory 20 year federal term.
That is how the problem is solved.
I have hammered away at crony capitalism in Big Gov for two years, but I do not want to see Congress men and women avoiding legal investments in the stock market. Capitalism is about people takling risks to benefit from ownership. The STOCK act updates inder tading laws to include Congressional inside-information. I just do not want conservatives to push legislation that tells Congress not to invest in the U.S. equities.
I guess CONgress must think we are really stupid, now I'm not a lawyer, congressman or even a heavy stock investor, but the first loophole I came up with is, I'll let a relative do the investing for me for a fee,invest in small amounts, multiple times staying off the radar.Every single piece of legislation I've seen pertaining to congress is written in code(see Obamacare) so the loopholers or their lawyers will be able to circumvent these rules quite easily.
Elizabeth Warren said the same thing on the Daily Show last night. She wants to see people in the congress give up control of their private stock holdings before they are allowed to serve.
According to wife number two, Newt was broke his entire adult life, but now he's worth millions? Service to your country can be very lucrative.
I think that if you accomplish the no-trading regulation of congress people there will be no need to limit their terms. The bad ones will opt out to cash in.
LOL, KJ! I thought government bonds but, you might have the better idea!
All the rules and are too easy to circumvent.
We need to elect honest, uncorrupted indivduals to serve.
I know it's alot to ask but this practice has to stop or
all faith will be lost in an honest and fair system.
As if there is any left…
Petro,
To tell you the truth, I really would be afraid, and probably embarrassed, if I knew what was really going on behind the curtain. Scenes from Caligula come to mind.
But seriously.
Let them shut it down. All that will do is eliminate those who are not fervent believers of the ideals of freedom and Liberty. Back around the 1770's, there was no Internet. No TV, no Radio, no Telephone, no Twitter. Mail moved on horseback if it moved at all, and even when it did, it was unlikely that it would show up at the intended address. Things moved slow. Real slow.
Things moved by word of mouth.
From one Patriot to another.
But there was an ideal, a dream, a spark, and it ignited a Nation.
Let Obama and his minions do whatever it is they want to do.
At the end of the day, he is as relevant as King George.
Also need the stop profiting (on) inside knowledge (of) executive (branch), or SPIKE act
They'll have an "opt out" clause,(just like obamacare) somewhere in there.
So they can take care of their own.
After all…………….membership has it's priveledges.
Scooter
Why do you insist on following me around and posting comments to me?
Why don't you go bother someone who actually gives a shyte. I don't.
You cyberstalkers are beginning to annoy me.
Consider yourself lucky I am not a school.
You'd have to stay 1,000 yards away.
Chriss
"but I do not want to see Congress men and women avoiding legal investments in the stock market"
Who will define legal, and set the parameters?
You?
Me?
Andrew Breitbart?
Matt Drudge?
Mitt Romney?
Newt Gingrich?
Boone Pickens?
Nancy Pelosi?
To tell you the truth, I'll opt out.
When the human element of greed comes into play, there is always room for abuse.
It all goes back to simple thing.
Honor
Or lack thereof.
Would a farmer use a fox or wolf to guard a chicken coop full of chickens. I doubt it. How can we trust congress to write a law keeping them from profiting on insider information?
Maybe – If a law were written in such a way that anyone caught using privileged information to fatten his/her wallet would be fired, loose all retirement benefits, and spent some quality time behind bars – some might be dissuaded from playing the game.
"After all…………….membership has it's priveledges."
Priceless!
Just think how many Thomas Paines are ensconced in the hills and valleys of this great land. The word of freedom will get out and spread across this nation no matter what.
It seems that Congress has exempted themselves from the laws that are already on the books. Typical congressional behavior.
We are entering a time, that will definitely separate the men from the boys.
Right. I figure there are too many boys out there anyway. Snicker.
You know, this is a very difficult thing to address. It appears it has to be approached from the angle that ALL congress critters are in it for the money. That they will take advantage of their position the first chance they get. This is a cynical outlook and it saddens me that it is one that has to be taken.
This is not what I thought America to be. A place where you could take a man, or woman, at their word. Call me a Pollyanna if you like.
It seems we have to punish the little guy (maybe even some big guys) who really want to make a difference by lumping them all under the heading of potential crooks. Yes, many probably deserve the title but, some do not.
Let's all just remember, rules, laws and regulations never stopped a criminal from being a criminal and hope they do the best they can in drafting this thing.
"How can we trust congress to write a law keeping them from profiting on insider information?"
We cannot.
It cannot be done.
That thought runs counter to the human psyche.
That it will, my old friend….
Sounds good, but the real lawyers/politicians will let their brother in law do the trading until they retire/don't get re elected or go to prision.
Chriss, Is there a provision that says Sen Joe working on health care can't speak to to Sen Ann working on energy trade his info for hers, thereby skirting the rule of investing in the companies they're working on?I see too many flaws when congress tries to govern itself, never seems to work out well for the folks.When a private citizen makes a salary of 174k a year and someone in congress makes the same, it just seems weird that the person in congress seems to reach millionaire status much earlier.Are the congressmen that much smarter or do they hold an advantage?To me it's crony capitalism at the very least.As CL asks"Who will define legal, and set the parameters? "
Sadly I will say I was only joking, because I know that this would only lead to more fraud. MOST of our financial mess, including our financial collapse in '08 is due to the failures that were totally created by the democrats community reinvestment act. They forced out the CEO of AIG because he would not underwrite their double down bet that the housing market would collapse, when they were causing it to collapse.
This was nothing more than the connected people complaining that they could not steal enough from the markets they were creating. They eventually created this market after Elliot Spitzer took down the CEO at AIG, which is what caused the collapses of our markets and Lehman Brothers in 2000. These guys in Washington are crooks, and they should be treated as such. Most of Washington are MAJOR THEIFS under old law. They keep chang things to make sure they don't get in trouble. It's called organized crime, or what we used to call the MOB.
"You know, this is a very difficult thing to address. It appears it has to be approached from the angle that ALL congress critters are in it for the money."
I agree Nick, but my faith lies in the good guys and there are some that truly want to serve ,if I didn't believe it I probably wouldn't vote,but in reality the longer they're in the game the more they become swayed.When they sit down to write this they have to take their time and start from the point of view is ,how to stop this and not how do we write the rule where we can get around it without anyone knowing. They would also get some credibility if they wrote in layman's terms not lawyer speak.
Typo – The year was 2008.
Fannie and Freddie is one of those dirty little inside games that both sides get huge amounts of money from, so nether side wants to rock the boat. That is one of my biggest issues with Newt. He took money from these crooks.
I understand your concern. I just do not want to forbid investors from serving in Congress. In my experience, the real insider trading in government has to do with real estate. I know plenty of politicians who miraculously bought property right before a freeway was announced or a new military base was located. The STOCK act is a very good start.
There is a school of thought that existing laws for fraud and conversion would cover Congressional actions. The problem is that law enforcement does not want to rock the boat from the hand that feeds. The STOCK act is a good start. I just don't want this to turn out like the scandal on Enron generating Sarbanes-Oxley Act that made U.S. markets very unfriendly to new IPOs.
http://en.wikipedia.org/wiki/Sarbanes-Oxley_Act
I am concerned this will generate another Sarbanes-Oxley: http://en.wikipedia.org/wiki/Sarbanes-Oxley_Act or Dodd-Frank Act, which I believe have hurt our nation.
You are absolutely correct with those concerns.
Dodd-Frank is a disaster.
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