Wednesday, June 19, 2013
A hearing examining whether legislation is needed to stop lawmakers from profiting on stock trades by using inside information will be held as early as next week in Sen. Susan Collins’ committee. (Udpate as of Nov. 23: The hearing is set for Dec. 1)
The hearing in the Senate Committee on Homeland Security and Governmental Affairs was requested by Sen. Scott Brown, D-Mass., a committee member who has introduced a bill he calls the Stop Trading on Congressional Knowledge, or STOCK, Act.
Collins, the committee’s top Republican, and Sen. Joe Lieberman, I-Conn., the committee’s chairman, say they are holding the hearing to look into how existing insider trading laws apply to members of Congress and whether new laws are needed. Congress is on break this week and a precise hearing date had not been set as of today.
The issue of whether lawmakers gain access to valuable non-public information – such as whether a hearing probing a company for wrongdoing will be held or legislative impacting a company will be introduced – that they could use to profit on in the stock market ahead of the general public is not a new one. Reps. Louise Slaughter, D-N.Y., and Tim Walz, D-Minn., have had a similar proposal that hasn’t gone anywhere in the House.
But a 60 Minutes report on CBS earlier this month raising questions about whether several lawmakers – including House Speaker John Boehner, R-Ohio and House Minority Leader Nancy Pelosi, D-Cal., - profited from inside legislative information renewed interest in the issue. Boehner and Pelosi have denied any impropriety.
The proposed legislation would specifically include legislative information as insider information that can’t be used to profit on stock trades.
GOP Sen. Olympia Snowe of Maine is one of four lawmakers who so far have co-sponsored Brown’s bill, which he introduced Nov. 15. Snowe also backs a separate proposal by Democratic Sen. Kirsten Gillibrand of New York. Gillibrand's bill also will be looked at during the hearing.
Democrat Reps. Chellie Pingree, D-1st District, and Mike Michaud, D-2nd District, are among more than 90 lawmakers who back the House bill.
Laws preventing people from using inside corporate information to profit on stock trades apply to lawmakers, too. However, the question is whether inside information about legislative activity, even if it could impact on a company’s stock, should count as illegal insider trading.
Brown says Congress and the Supreme Court are the only two federal entities – out of 975 - that don’t have specific rules laws preventing stock trading based on non-public information.
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Kevin Miller is Washington bureau chief for the Portland Press Herald and MaineToday Media. He has worked as a journalist in Maine for 6 ½ years, covering the environment, politics and the State House. Before arriving in Maine, he wrote about politics, government and education for newspapers in Virginia and Maryland.
Kevin can be reached at 317-6256 or kmiller@mainetoday.com
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