As reported in the Wall Street Journal, the U.S. Senate overwhelmingly passed a bill today to ban lawmakers from profiting from inside information they learn while in the course of their duties in Congress. The bill goes to the House for a vote next week. There is so much heat and light on this issue that it seems inevitable the House will pass the bill.
It’s astounding that it has taken years of trying to get this far in the legislature with an insider trading ban. While it may seem a “no-brainer” there have been forces opposing such a ban for a long time. And the opposition has come from members on both sides of the aisle. Democrat, Ms. Pelosi and Republican, Mr. Bachus were two of the members in the news in recent months for engaging in this “legal” activity. If any of us in the investment profession, or even outside of it (remember Martha Stewart’s troubles in this area), engaged in similar activity we would be fined, risk losings a license, or in extreme cases even jailed.
It’s no wonder the members of Congress have poor ratings and such a credibility void in the eyes of the American people. Kudos to the Wall Street Journal for bringing this matter to the forefront in the last few months. The pressure became too much for Congress to sweep it under the rug. Watch for the outcome in the House next week.
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