After knowledge of former speaker Nancy Pelosi and other members of Congress making millions from stock trading, a campaign to ban members is picking up steam. Not only did research reveal politicians made “trades worth more than $1 billion last year” but “many vastly outperformed the market” , reports the Daily Mail.
A current proposed law – Ending Trading and Holdings in Congressional Stocks- known as the ETHICS act – already has the backing of several members, but needs more support for passage. The legislation would prohibit members in Congress and their closest relatives from owning or trading stocks altogether.
While none of the lawmakers are accused of illegal activity, several disclosures revealed members’ success on the stock market last year:
Nancy Pelosi, the former House Speaker, is one of the most prolific traders, having made trades totaling around $100 million since 2019. Her returns were around 65 percent last year, according to an analysis, vastly outperforming the broader market.
Democratic Rep. Brian Higgins of New York was singled out as one of Congress’ best performers after he enjoyed returns of 238 percent on his investments, placing him number one in terms of percentage gains. Higgins’ gains came from several trades in 2020.
Mark Green, the Republican chair of the Homeland Security Committee, was found to have made gains of 122.2 percent. Other studies have found that stocks chosen by members of Congress have returned around 273 percent since April 2020.
According to the Daily Mail, polls have shown 70 percent of Americans support a ban on lawmakers trading. “The overwhelming majority of Americans want this to stop. So let’s make it stop” said RepresentUs CEO Joshua Graham Lynn. “It’s outrageous that members of Congress are gaming the stock market while millions of Americans struggle to make ends meet. I’d call it gangster behavior, but that would imply it’s illegal and, sadly, it is not.”
The Daily Mail reports that currently, lawmakers are “bound by the 2012 STOCK act, an acronym for Stop Trading on Congressional Knowledge. The law makes it illegal for politicians and their staff to use private information derived from their official work for personal gain. Lawmakers must also disclose their trades within 45 days.”
However, punishment for violating the act is a fine of only $200; a figure which is not only trivial money for the politicians, but dozens of lawmakers from both sides have “repeatedly breached the rules of the act.”