Congress Quietly Repeals Congressional Insider Trading Ban

While Congress might be stuck in a deadlock on just about every issue imaginable, there’s one piece of legislation that both Democrats and Republicans hate unanimously: the Stop Trading on Congressional Knowledge (STOCK) Act, a law passed last year designed to prevent insider trading among lawmakers and government officials by requiring them to post disclosures of their financial transactions online.

Both parties and both houses of Congress hated the disclosure portion of the law so much that it was repealed on Friday without debate—the measure was sent to the president by unanimous consent. The ordeal took about 10 seconds in the Senate and 14 seconds in the House, according to official records.

The STOCK Act would have required members of Congress, their aides, and other federal employees making more than $119,554 a year to disclose their financial dealings in an online database. It was supposed to prevent government officials from using insider knowledge about policy-making to profit from stock trades and other investments.

Upon the signing of the bill into law last year (pictured above), President Barack Obama said, “The idea that everybody plays by the same rules is one of our most cherished American values. It’s the notion that the powerful shouldn’t get to create one set of rules for themselves and another set of rules for everybody else, and if we expect that to apply to our biggest corporations and to our most successful citizens, it certainly should apply to our elected officials—especially at a time when there is a deficit of trust between this city and the rest of the country.” The White House has not said whether the president will sign the repeal.

Despite the repeal, government officials will still have to file disclosures of securities trades over  $1,000 within 45 days, but they no longer have to file them in a searchable database that was to be easily accessible to the public.

Congress and the President had delayed the online posting portion of the act from going into effect 3 times already, but the ultimate repeal came after the National Academy of Public Administration, a nonprofit group, found that publishing the information would create an “unwarranted risk to national security and law enforcement, as well as threaten agency missions, individual safety and privacy,” in a report delivered last month. The group suggested that the online posting requirements should be suspended indefinitely.

Lisa Rosenberg of the Sunlight Foundation, a nonprofit group advocating for government transparency, said that the repeal “sets an extraordinarily dangerous precedent suggesting that any risks stem not from information being public but from public information being online.”

Rosenberg raises an interesting point: Since these financial disclosures are still considered public information, how does not posting them on the Internet mitigate their potential risks to national security? How does obfuscating information about the financial activities of government officials help anyone, other than those officials? Does the potential danger come from foreign terrorists knowing this information or from those citizens who just to know if their government officials are behaving responsibly?

UPDATE: White House spokesperson Jay Carney announced that Obama has signed the repeal of the internet disclosure portion of the STOCK Act.

[Image via]



36 Comments

  • Dudley Do Right
    April 17, 2013

    Let us not forget that with sequestration, funding for such a low level skullduggery investigations will not be readily available.

  • Chris Liberal
    April 17, 2013

    Thanks Traci and Sakib,
    I consider myself a liberal, but take offense to misleading information. You are right,this bill clearly states that it is government employees EXCEPT Congress,the President,Cabinet and even candidates for congress. Putting out this kind of misleading article only makes liberals look as bad as the other side. Thanks for pointing it out.

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  • Charles Brown
    April 18, 2013

    So just ban them from investing while serving… they can do all their insider trading AFTER they are out of power. This isn’t rocket science… it’s friggin’ politics. I don’t care what criminal behavior they do when they AREN’T in office… that’s the police , the FBI and the SEC’s job.

  • glenn Miller
    April 19, 2013

    So back ground searches for gun ownership and opening ones personal information to any agency or individual who would seek that information on a private citizen is okay with congress—they just don’t want their personal information out their for all the world to see???????????????????
    How is that equal and just as the President said?

  • Alice Brown
    April 20, 2013

    How do I get to see the vote on this bill? What did Sen. Warren have to say? Surely she objected. They’re so unashamed of their crookedness (and that’s what it is), they don’t mind being publicized for voting to repeal the law. And with a Democratic majority in the Senate? When did we become so dumb? so powerless?

  • Will Smith
    April 29, 2013

    Now I know the reason that are dear elected officials are will to pay so much to get elected, thay can make up the cost with there insider trading on information they get from up comming deals. and then there was poor Mattha Stewart traded and made a small $250000 and sent to prison for insider trading .While are elected officials do the same all the time with no concequence to them is the this a level playing field or just our crooked congress geting rich off the information they get but would get any ordinary citizen sent to jail if they did the same as they do.

  • Ross Gerami
    April 29, 2013

    Can you beleive the corruption we have in our government Republicans & Democrats.First we had Eric Cantor sit on the proposed new Stock Law to change the way congress can exempt themselves from the law and they turn around and repeal the law. But yet we can’t even get better Gun Control Laws passed. Our government should all be voted out of office for the scum they all are.

  • Nancy Nelmes
    April 30, 2013

    By unanimous consent???? So NO ONE had to show their true colors by voting for the bill. Repealed without debate. Once again, Congress is showing their purpose in serving the country is selfish and has nothing to do with improving the lives of Americans that vote them in. I so hope the president vetoes it!

  • Tim Fahey
    May 1, 2013

    So let me get this straight: Obama calls to congratulate some gay guy who happens to play basketball and the media showers this hero with a whole bunch of attention while DURING THE BOSTON BOMBING CAPTURE ON FRIDAY when the whole world was watching, our slime bucket elected officials repeal the insider trading law enacted just a year ago to keep them on the straight and narrow? What a bunch of dirtbags. I still can not get over how they shove health care down our throats but don’t have the same coverage policy for themselves. Special license plates, special parking, special planes, special meals, special health care, special gyms, special everything. If they were just a bunch of people not affiliated with the government, how long would you put up with their bullshit? Well, it is our government. Here’s the rub: votes don’t count for much. So very frustrating.

  • Cassandra Richardson
    May 2, 2013

    Congratulations, America,
    In my opinion, you have now come to the top of the list of the most powerful and most corrupt nations in the world. Before Congress performed this despicable act, people could pretend that those individuals running for Congress did so out of a desire to do good in the world but no longer. Now it is out in the open that insider trading is the main reason these people seek office, to gain personal wealth for themselves; that information gleaned from their prestigious offices is being used to line the pockets of themselves, their families, and their friends. Shame on you people that deny us even a shred of comfort that we have been able to maintain by saying that they might be doing it for the medical insurance which is a thousand times better than the average working American, or the retirement benefits that is also a thousand times better than Social Security, or perhaps the other perks like the time off and the easy schedule and the travel. Shame on you, shame on you, shame on you for performing your dirty deed in the wee hours just like your raises and your benefit increases. You people disgust us. How did greed get so rampant within you that you forgot what our forefathers intended when they formed out Constitution?

  • Ron Chito
    May 5, 2013

    Isn’t this typical of our great trusted leaders. We are long over due to replace these crooks in the Senate and Congress !! Let’s take action and vote these losers out !

  • Michael stimely
    May 22, 2013

    This is simple, govt employees should have complete transparency, period. They are paid for and employed by the citizenry, I think this is something we have forgotten. If you want to be a leader, you MUST lead by example and expect to be closely scrutinized.

  • Tatloe Smith
    July 31, 2013

    We as citizens should not vote for any government employee that does not disclose his or her finacial statements. We have the power to get these scums out of office. It is our country that these deginerates are destroying. America it is time to fight back, if you care where your country is headed then do something now.

  • Ben Lee
    December 17, 2013

    I know the “STOCK” Act well.
    My demoncrat congressman Tim Walz pushed it right before he was re-elected. The local Rochester (com)Post Bulletin, and Minneapolis Star and Sickle Tribune propped up Walz enough with his STOCK “Oooh, just look – Walz is looking out for you!” Act to get him re-elected.
    See- here is what the demoncrats/Tim Walz do: they pass meaningless goodie two shoes stuff that the local DFL owned papers prop up and give lots of photo ops to, all while ignoring Walz’s REAL D.C. record – he votes lock step with 0bama/demoncrats agenda.
    Then Walz gets re-elected and goes back to DC and continues to be 0bama’s sure voting lap dog.
    The do-goodie bill WAS ALL FOR SHOW, and SIGNED OFF ONE MONTH PRIOR TO THE ELECTION.
    Walz/demoncrats knew all along it would get repealed. It was all a show, all smoke and mirrors, Kabuki Theater for the suckers back at home in order to get Walz re-elected so he could get back to DC and continue his partnership with 0bama and his annihilation of the USA.

  • dan haines
    April 16, 2014 (1 week ago)

    Congress Quietly Repeals Congressional Insider Trading Ban

    this headline is an outright LIE. they did not repeal any law to ban insider trading. what a travesty to the english language. they repealed a portion of a law that required them to post their trades ONLINE.. they still have to report their trades over 1000 dollars within 45 days, and there is no repeal of any insider trading ban.at all. this kind of reporting is disgusting.

    insider trading was and IS illegal for anyone and everyone who lives in the united states.

    i demand a correction and apology.

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