The U.S. House of Representatives approved the Stop Insider Trading Act in a 232-198 vote on Wednesday, advancing legislation that would bar members of Congress, their spouses, and dependent children from purchasing individual publicly traded stocks. Sponsored by Representative Bryan Steil (R-Wis.), the bill now moves to the Senate, where it faces uncertain prospects and criticism over loopholes that allow lawmakers to retain and sell existing holdings.
Under the proposed restrictions, new stock buys are prohibited, but lawmakers may keep shares already in their portfolios. Sales of existing stock would require a public notice filed at least seven days and no more than 14 days before the transaction. Violations would trigger a fine of $2,000 or 10% of the covered investment’s value—whichever is greater—plus forfeiture of any profits from the prohibited trade. Steil argued that the advance-notice requirement would deter improper trading by exposing planned sales to public scrutiny.
Senator Elizabeth Warren (D-Mass.) immediately criticized the bill, calling its omissions "major loopholes." She insisted that members of Congress should be banned from owning, buying, or selling individual stocks entirely. "Not gonna fly in the Senate," Warren posted on social media on Thursday. Senate Democrats may push for amendments requiring full divestiture, blind trusts, or broader restrictions before the bill proceeds.
The legislation’s limited scope is notable when contrasted with the ethics provisions being drafted in the Digital Asset Market Clarity Act (CLARITY Act). A revised version of that 616-page crypto market structure bill would prohibit the president, vice president, lawmakers, and federal judges from issuing or sponsoring digital assets through January 20, 2029. Crypto intermediaries would also be barred from listing tokens issued in violation of that rule. Unlike Steil’s permanent stock-trading ban, CLARITY’s crypto-related ethics restrictions would sunset after the specified date.
Steil has also introduced a separate measure—the Stop Lawmakers from Predicting Act—to prevent members of Congress and their families from wagering on political outcomes via prediction platforms like Kalshi and Polymarket. Its penalty structure mirrors the stock ban, underscoring a broader push to stop public officials from profiting from nonpublic information.
