House Minority Leader Kevin McCarthy is considering instituting a ban on lawmakers holding and trading stocks of individual companies, if the Republicans win a majority in the House of Representatives in November’s elections, according to a report in Punchbowl News.
McCarthy, a California Republican, has not yet decided on whether to push for an outright ban that could “force lawmakers to hold only professional managed mutual funds” or a less strict rule that would prevent representatives from holding stocks in companies or industries overseen by their specific committees, according to the report. It’s not clear whether McCarthy has the support within his caucus to implement such a rule change.
The news comes after the New York Post reported that Democratic Sen. Jon Ossoff of Georgia is planning to craft legislation that would ban members of Congress in both the House and the Senate from trading individual stocks. He is reportedly looking for a Republican to co-sponsor the legislation before introducing it.
Stock trading by members of Congress and their family members has become a matter of public debate after several instances in roughly the past year in which they have been accused of using nonpublic information gathered in the course of their duties to profit from stock trades.
In October, the Office of Congressional Ethics concluded that there “substantial reason to believe” that the wife of Pennsylvania Republican Rep. Mike Kelly used nonpublic information before purchasing stock in an Ohio steelmaker.
In 2012, Congress passed the Stock Act, signed into law by then President Obama, which made it illegal for members and their spouses to use nonpublic information to trade securities. But in the nearly 10 years since the law’s passage, nobody has been prosecuted under it.
In December, House Speaker Nancy Pelosi, a California Democrat, argued against such a ban. “We are a free-market economy,” Pelosi said. “They should be able to participate in that.”