Legislation making it clear that members of Congress are subjected to federal anti-fraud and insider trading laws cleared the House Thursday but not without being nearly gutted by House Republican Majority Leader Eric Cantor.
The House version of the Stop Trading on Congressional Knowledge (STOCK) Act would prohibit members of Congress and their employees from disclosing nonpublic information on “any pending or prospective legislative action relating to any publicly traded company” and require lawmakers to publicly report any trades of more than $1000 within 90 days.
But the House version omits two important Senate provisions. One would require that people who get paid to gather political intelligence register as lobbyists. The other is a bipartisan proposal to toughen federal anti-corruption laws.
Craig Holman of Public Citizen offered this take on the bill that came out of the House. “[Rep.]Cantorís decision to weaken the legislation, which was roundly condemned by congressional Democrats and Republicans alike, is a gift to the financial interests that oppose transparency of trades that exploit insider knowledge.”
Even Senate Republicans were shocked by Cantor’s actions. Sen Chuck Grassley (R-Iowa) called them “astonishing and extremely disappointing.”
All hope is not lost though for ethics reform with some teeth. A conference committee could be formed to work out the differences between the House and the Senate bills with the possibility of some of these provisions making their way back in. President Obama called on Congress to pass the STOCK Act and he’s expecting a strong one. If that doesn’t happen Republicans will have some explaining to do.
Photo from Katrina. Tuliao via flickr.