Wednesday 1 February 2012

Senate clears way for vote on insider-trading ban

(AP) ? Congress' low approval ratings have sparked a rare instance of bipartisanship, as both parties are rushing to pass a bill that would make it clear that insider trading laws apply to lawmakers.

The Senate voted 93-2 Monday to clear the way for consideration of amendments and ? sponsors hope ? final passage later this week.

Members of both parties looked at approval ratings in the teens in an election year and didn't like what they saw. But it was an independent, Sen. Joseph Lieberman of Connecticut, who may have best expressed Congress' political plight.

"The numbers of people who have a favorable impression of this body are so low that we're down to close relatives and paid staff. And I'm not so sure about the paid staff," he said.

The legislation would require disclosure of new stock transactions on the Internet within 30 days and explicitly prohibit members of Congress from initiating trades based on non-public information they acquired in their official capacity. The legislation, at least partly symbolic, is aimed at answering critics who say lawmakers profit from businesses where they have special knowledge.

U.S. lawmakers already are subject to the same penalties as other investors who use non-public information to enrich themselves, though no member of Congress in recent memory has been charged with insider trading. In 2005, the Securities and Exchange Commission and Justice Department investigated then-Senate Majority Leader Bill Frist's sale of stock in his family's hospital company, but no charges were ever brought against the Tennessee Republican.

Voters may believe lawmakers who are paid an annual salary of $174,000 are enriching themselves ? especially if those voters saw a segment of CBS' "60 Minutes" in November. The show questioned trades by a House committee chairman, the current speaker and his predecessor's husband. Rep. Spencer Bachus, R-Ala., Speaker John Boehner, R-Ohio, and former Speaker Nancy Pelosi, D-Calif., all denied wrongdoing. Bachus chairs the Financial Services Committee.

A recent Wall Street Journal/NBC News poll of registered voters found 56 percent favored replacing the entire 535-member Congress. Other polls this year have given Congress approval ratings between 11 percent and 13 percent, while disapproval percentages have ranged from 79 percent to 86 percent.

The bill is titled the Stop Trading on Congressional Knowledge (STOCK) Act. President Barack Obama has endorsed it.

The Senate bill would prohibit lawmakers from tipping off family members or others about non-public information that could influence a stock's price, in addition to the explicit ban itself. And it would direct the House and Senate ethics committees to write rules that would make insider trading violators subject to congressional punishment.

House leaders are working on a more expansive bill that would include land deals and other non-stock transactions. A vote is expected in February.

Associated Press

Source: http://hosted2.ap.org/APDEFAULT/386c25518f464186bf7a2ac026580ce7/Article_2012-01-31-Congress-Insider%20Trading/id-23e2fd398f4d4ca7ad9e3563692e8e03

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