With the Senate Homeland Security and Governmental Affairs Committee having advanced a bill explicitly banning congressional insider trading in a 7-2 vote, Sen. Kirsten Gillibrand (D-NY) is receiving well-deserved praise for offering significant improvements to the STOCK (Stop Trading On Congressional Knowledge) Act.
“The American people deserve the right to know their lawmakers’ only interest is what’s best for the country, not their own financial interests,” said Sen. Gillibrand.
In addition to banning insider trading by members of Congress, Sen. Gillibrand’s improvements to the bill ensure that so-called “tipping” of nonpublic information will be explicitly barred, shortens the time period for public disclosure of investments by members of Congress from 90 days to 30, closes a major loophole that would have extended the law only to pending legislation, and brings the insider trading laws governing elected officials, their staffs, and family members into alignment with those governing citizens.
“In sum, Senator Gillibrand and her staff are to be highly commended for coming up with a ban on Congressional insider trading that is simple, effective, comprehensive, and workable,” says insider trading expert and UCLA Law Professor Stephen Bainbridge.
Originally, Sen. Gillibrand had offered legislative language that had been roundly criticized as imprecise and containing typos and loopholes that would have in effect legalized, not banned, congressional insider trading.
Sen. Kirsten Gillibrand deserves credit for offering a revised bill that corrects her bill’s earlier deficiencies and offers stronger, more comprehensive insider trading reforms to ban the use of material, nonpublic information by members of Congress.