US: Congressmen move to stop insider trading by members

Some 37 members of the US Congress are hoping to push for a third time their coveted bill seeking to prevent insider trading by both members of the senate and House of Representatives.

The Bill aims to prevent lawmakers from insider trading through the The Transparent Representation Upholding Service and Trust in Congress Act, or TRUST.

This was first introduced in June 2020 and brought back to the House floor in January 2021. However, it never went further than that, media reports said.

On January 12, Reps. Abigail Spanberger of Virginia and Chip Roy of Texas, supported by a bipartisan alliance of 35 co-sponsors, reintroduced the bill.

“We saw tremendous momentum, we saw growing support in our districts, and we saw growing recognition across the political spectrum that such a reform needs to be made now,” Spanberger said in a statement.

“Our TRUST in Congress Act would demonstrate that lawmakers are focused on serving the interests of the American people — not their own stock portfolios,” the reports quoting a portal said.

The issue TRUST seeks to resolve. If passed, TRUST would effectively ban members of Congress, their spouses and children from trading individual stocks and force them to place their investment assets into blind trusts. The legislation aims to address the advantage that politicians have as well-connected people with the inside track on new legislation that might affect a company or an industry.

While those insights don’t make them clairvoyant, it’s certainly an advantage when it comes to trading in the stock market, the reports claimed.

The conservative advocacy group Convention of States Action commissioned a survey last year which showed that more than 75 per cent of voters believe lawmakers have an unfair advantage when trading — and those feelings aren’t unfounded.

A report from a leading media outlet disclosed that 72 members of Congress didn’t report their financial trades as they are mandated to do by the Stop Trading on Congressional Knowledge Act of 2012.

The Wall Street Journal conducted an independent investigation which revealed thousands of Washington officials are taking part in ethically gray trading.

TRUST seeks to reduce it. They would still, however, be able to purchase diversified ETFs, diversified mutual funds, and US Treasury bills, notes or bonds.

“The American people are tired of seeing members of Congress making pretty significant profits while they’re voting on the very policies that affect the corporations they’re meeting with on a regular basis,” Roy told Fox Business.

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