Bipartisan Bill Pushes Congress Toward Stock Trading Ban

A new bipartisan proposal in the House aims to prevent lawmakers and their families from trading individual stocks, according to a report by The Wall Street Journal. The plan represents the most serious push in years to address concerns that public officials can profit from private access to information.Elevate Your Investing Strategy: Take advantage of TipRanks Premium at 50% off! Unlock powerful investing tools, advanced data, and expert analyst insights to help you invest with confidence. Under the measure, current lawmakers and their families would have 180 days to sell individual stocks they own. Future lawmakers would have 90 days from their swearing-in to exit such positions. The rules would also apply to stocks held in blind trusts. Those who fail to comply would face fines equal to 10% of the investment's value and would be required to give up any profits tied to the trades. However, there are exceptions for shares that spouses or children receive as part of their job compensation. Growing Support and Mixed Views The proposal was negotiated by Rep. Seth Magaziner, a Democrat from Rhode Island, and gained backing from a broad coalition across the political spectrum. Talks included conservatives such as Rep. Chip Roy of Texas and Rep. Tim Burchett of Tennessee, along with progressives like Rep. Alexandria Ocasio-Cortez of New York and Rep. Pramila Jayapal of Washington. House Speaker Mike Johnson has expressed general support for a ban but has not endorsed a specific bill. President Trump has said he is open to tighter rules, while Treasury Secretary Scott Bessent has also voiced support. At the same time, some lawmakers argue the proposal goes too far. They note insider trading is already illegal and warn that mandatory sales could create added tax costs and compliance challenges. Supporters counter that lawmakers often sit in briefings and meetings that provide access to information unavailable to the public, creating what they see as an uneven playing field. Pelosi Trades and Public Scrutiny One notable example that highlights the motivation behind this proposal centers around Nancy Pelosi and her husband, Paul Pelosi; Paul Pelosi's profitable trades in large companies, such as his purchase of Nvidia (NVDA) shares ahead of a key subsidy vote and his sale of Visa (V) stock before a Department of Justice antitrust case, raised questions about possible conflicts. Their investments have often outperformed the market, and the timing of certain trades near congressional actions has sparked calls for audits and inspired dedicated social media trackers. Nancy Pelosi has denied any role or knowledge of her husband's trades, while her office maintains that all disclosures follow existing law. Market Impact Only about one-third of House members and less than half of senators reported stock trades last year. Most lawmakers hold mutual funds or other pooled investments, which would not be affected by the proposal. Still, stricter rules could change how some manage their personal wealth and may push more assets into diversified funds. We used TipRanks' Comparison Tool to line up some of Nancy Pelosi and her husband's recent stock holdings side by side, and how they stack up as long-term winners. Disclaimer & DisclosureReport an Issue