| The bill would have let every member keep every share already owned, and sell it with a week of notice. |
| LEAD ESSAY / 4 MIN / 4 DOCUMENTS / STORY FILE CONG-BAN |
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| What happens to you if you buy a stock on a tip you heard in a closed-door meeting? |
| You'd hear from the Securities and Exchange Commission, the federal agency that polices the stock market. And you could end up with a lawyer, a fine, and a prison cell. Your members of Congress sit in closed-door briefings every week. They're still allowed to own and trade single stocks, as long as they report each trade within 45 days. |
| On Sept. 30, the Senate had a chance to change that... and it let the chance go. I've read the bill that died, all 14 pages of it. Let me walk you through what it would have done, how the vote went, and who got $1 million in backing five days later. |
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Bryan Steil's bill, H.R. 7008 |
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| Rep. Bryan Steil of Wisconsin wrote the Stop Insider Trading Act. He filed it in January, and the House passed it 232 to 198 on July 22. And 13 Democrats joined every Republican who voted. |
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| “Can’t take yes for an answer.” |
| JOHN THUNE ON SENATE DEMOCRATS, VIA ROLL CALL |
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| Before that final House vote, Republican leaders attached a voter ID requirement to it. That's a rule making Americans show a photo ID before they can cast a ballot. Democrats said the clause was there to make them vote no, and in the Senate they did. |
| Getting past the first procedural step took 60 votes. It got 53. Every Democrat voted against it, and Majority Leader John Thune accused them of playing election politics. |
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Rules Committee Print 119-38 |
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| So what would the bill have done? Rather than trust the speeches, I went to the text the House passed. |
| FILED / RULES COMMITTEE PRINT 119-38 |
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| Members of Congress, their spouses and their dependent children could no longer buy new stocks. Selling would stay legal with 7 to 14 days of public notice. Breaking the rule costs $2,000 or 10% of the trade, whichever is more, plus any gain. |
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| Now look at what stays. A member who already owns a stock keeps it, and the dividends keep coming. Shares held in a trust the member can't control, run by a nonrelative, don't count. Neither do widely held funds, or trades a spouse makes as part of a job. So the most a lawmaker gives up is the next purchase. Read that section yourself, and you'll find it says exactly that. |
| Members of both parties conceded that the bill still left room to profit from selling. To me, that's the part of the bill worth remembering. And a tougher bill already exists. Sen. Josh Hawley's version would ban owning single stocks, and a Senate committee approved it last summer. That bill still hasn't had a vote on the Senate floor... |
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$1 million, five days later |
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| Here's what happened next. Fairshake said on Oct. 5 that it would spend $1 million each backing six House incumbents. It's the crypto industry's biggest super PAC. In plain English, that's a political group that can raise unlimited money, as long as it spends that money on its own and doesn't hand it to a campaign. |
| Steil was one of the six, and he chairs the House subcommittee on digital assets, the panel that writes the rules for crypto. French Hill, who chairs the full Financial Services Committee, got the same commitment. So did Bill Huizenga, its vice chair, plus Democrats Janelle Bynum, Steven Horsford and Derek Tran. I count three from each party, which matches the PAC's pitch that it backs both sides. |
| Its biggest donors are tied to Coinbase, Ripple and the venture firm Andreessen Horowitz, Roll Call reported. The PAC had $108 million in the bank at the end of August. None of it breaks a law, and the spending gets reported to the Federal Election Commission. Still, you can read the bill's text next to that donor list, and you'll see what I saw. Congress argued for months over what its members may own. During those same months, the industry they regulate was raising money to keep its allies in office. |
| Think about where that leaves you. If you trade on a private tip, you can face prison. Lawmakers live under that same law on paper, thanks to the 2012 STOCK Act. But they still sit in the briefings, they still buy, sell and hold single stocks, and they report it weeks later. My advice is simple. Look up your own members on the House and Senate disclosure sites before you vote on Nov. 3. Each trade they file is public, and it's your money they're voting on. |
