When Rep. George Whitesides, D-Agua Dulce, ran for office last year, he said he’d work to ban members of Congress from trading individual stocks as a way to curb potential insider trading.
In March, the freshman congressmember from Los Angeles County sold off all 34 of his individual stock holdings.
“I sold all my individual single stock holdings because it’s the right thing to do,” Whitesides said in a recent interview. “Congress people shouldn’t trade individual stocks. I think it’s just a situation that is ripe for conflict of interest.”
Whitesides still has investments in exchange-traded funds, which are made up of various securities, much like mutual funds.
But for years, the question on Capitol Hill has been whether sitting members of Congress should be allowed to trade individual stocks.
And despite polls showing an overwhelming majority of Republicans and Democrats alike support such bans, there never seemed to be enough political will to get a law passed.
Until perhaps now.
Efforts to ban congressional stock trading have gained traction in recent weeks, with President Donald Trump saying he “absolutely” would sign a bill banning such trades and with both House Speaker Mike Johnson, R-Louisiana, and Minority Leader Hakeem Jeffries, D-New York, throwing their support behind such restrictions.
The issue resurfaced after speculations about whether members of Congress, like Rep. Marjorie Taylor Greene, a Republican from Georgia, had engaged in insider trading during a volatile period as the stock market reacted to Trump’s tariffs announcements in April. Greene has denied violating any laws and has said that her financial advisor controls her investments.
Meanwhile, lawmakers seeking reforms are seizing on the momentum of the past several weeks in hopes of getting a new law passed.
One of these efforts is a bipartisan bill led by Reps. Seth Magaziner, D-Rhode Island, and Chip Roy, R-Texas, who in January reintroduced the Transparent Representation Upholding Service and Trust (TRUST) in Congress Act.
Over 70 House members have signed onto that bill, which would prohibit members of Congress, their spouses and dependent children from trading individual stocks and would require them to divest from individual stock holdings or place them in a qualified blind trust.
Among those co-sponsoring the bill are Reps. Laura Friedman, D-Glendale; Robert Garcia, D-Long Beach; Young Kim, R-Anaheim Hills; Mike Levin, D-San Juan Capistrano; and Linda Sánchez, D-Whittier.
Similar bills that have been introduced in Congress this session include the Bipartisan Restoring Faith in Government Act, worked on by Reps. Brian Fitzpatrick, a Republican from Pennsylvania, and Alexandria Ocasio-Cortez, a Democrat from New York, among others.
On the Senate side, there’s the Preventing Elected Leaders from Owning Securities and Investments (PELOSI) Act.
Sen. Josh Hawley, a Republican from Missouri, is behind that bill, with an acronym intended as a dig at former Speaker Nancy Pelosi, a Democrat from San Francisco whose husband has endured public scrutiny for amassing a fortune from stock trading. There’s never been evidence that the Pelosis engaged in insider trading.
In an interview this week, Magaziner — whose bill has garnered the most co-sponsors — said he’s been talking with House colleagues who have worked on similar legislation to come up with a consensus bill.
“Those talks have been going well, and I think we’re getting close. … It will not be long,” he said.
Asked when he thought the full House might vote on a bill, he said that would be up to the speaker.
“He (Johnson) controls the floor. He controls what bills come up. We’re going to hold him to his statement that he supports this issue. But he has to actually act and not just speak,” said Magaziner.
Earlier this month, more than a dozen lawmakers from both the Democratic and Republican parties urged Johnson to call for a vote.
In remarks on the House floor, Kim said it’s unfortunate that some members of Congress make “lucrative stock trades while their constituents struggle to make ends meet.”
“We must restore public trust in this body, and that starts with each of us in this chamber,” said the lawmaker who represents communities in Orange, Riverside and San Bernardino counties. “There is no reason why members of Congress should be able to trade stocks while in office, period.”
“This isn’t rocket science,” said Kim. “This is common sense.”
Whitesides, who hasn’t officially endorsed any of the stock trading ban bills that have been introduced, said he’s focused on making sure there’s broad consensus with enough members of Congress to get a bill addressing the issue passed.
“At the end of the day, what this is about is trying to increase the public’s faith in Congress and in their federal government so that they know that the people in Congress are making decisions based on what’s best for the country, not what’s best for their stock portfolios,” Whitesides said.
Citizens for Responsibility and Ethics in Washington, a nonpartisan, nonprofit government watchdog group that focuses on money and politics, has supported banning the spouses and dependents of members of Congress from owning or trading individual stocks.
Jordan Libowitz, vice president of communications for CREW, said that although placing stocks into a blind trust would be a step in the right direction, it would be better for those elected to Congress to fully divest their individual holdings before putting the assets into what he called “a truly blind trust.”
Since 2012, certain individuals in federal government, including members of Congress, must report within 45 days when they make “a purchase, sale, or exchange which exceeds $1,000 in stocks, bonds, commodities futures, and other forms of securities.”
That law, known as the Stop Trading on Congressional Knowledge Act, or STOCK Act, was a major step forward, but more needs to be done, said Libowitz, adding that calls for additional reform have been growing.
“Congress is slow to pass pretty much anything, but especially when it comes to regulating Congress,” Libowitz said. “But probably over the last four years, we’ve seen a growing sense in Congress that they need to do something about this.”
“There is a sense of optimism that Congress will eventually deal with this,” he said.
