The US lawmakers in the Congress are allowed to own and trade in stocks and other securities, under law. Currently, the Stop Trading on Congressional Knowledge (STOCK Act) mandates that Congress members file financial disclosures of their stock trades within 30 days and imposes new penalties for insider trading.
Effectively, the members of Congress can own, buy, and sell individual stock even where that stock will conflict with their official duties.
Unusual Whales, a startup, has found that the stock portfolios of numerous Congress members from both major parties outperformed the S&P 500 in 2024.
Going forward, this practice may stop. U.S. Senator Josh Hawley has reintroduced the Preventing Elected Leaders from Owning Securities and Investments (PELOSI) Act, which would ban members of Congress from trading or holding individual stocks. The move comes after President Trump announced he would sign such a bill into law if it crossed his desk.
“Members of Congress should be fighting for the people they were elected to serve—not day trading at the expense of their constituents,” stated Senator Hawley.
“Americans have seen politician after politician turn a profit using information not available to the general public. It’s time we ban all members of Congress from trading and holding stocks and restore Americans’ trust in our nation’s legislative body.”
The PELOSI Act would ban lawmakers and their spouses from holding, purchasing or selling individual stocks for the duration of the lawmaker’s time in office. Lawmakers would be allowed to invest in diversified mutual funds, exchange-traded funds, or U.S. Treasury bonds while in office.
If passed, current lawmakers would have 180 days to comply with the legislation. Likewise, newly elected members of Congress would be required to comply within 180 days of taking office.
Members who refuse to comply with the PELOSI Act must forfeit any stock profits to the U.S. Department of the Treasury and face monetary penalties imposed by the House and Senate ethics committees.
Congress (with Campaign Legal Center’s support) had passed the Stop Trading on Congressional Knowledge (STOCK Act) in 2012. The act requires members of Congress to file financial disclosures of their stock trades within 30 days (previously, they were only required to file annual disclosures) and places new penalties on members who used information for insider trading.