March 22 (Bloomberg) -- The U.S. Senate voted to strengthen the ban on insider securities trading by members of Congress and other government officials a day after a poll showed 82 percent of Americans disapprove of lawmakers’ work.
The Senate’s 96-3 vote sends the measure to President Barack Obama for his signature. The legislation, S. 2038, would bar members of Congress, their staffs and some executive branch workers from trading stocks, commodities or futures based on non-public information they learn on the job. It would prevent lawmakers from participating in initial public offerings that aren’t available to the general public.
The House passed the measure Feb. 9 on a 417-2 vote. Obama called for passage of a congressional insider trading bill in his State of the Union address.
The bill is the “most significant congressional ethics reform in at least five years,” said Senator Joe Lieberman, a Connecticut independent who caucuses with Democrats, and chairman of the Senate Homeland Security and Governmental Affairs Committee.
Members of Congress aren’t exempt from existing federal insider-trading laws, though the Constitution’s protection of their speech and debate may complicate investigations of potential violations under existing law.
The bill also would require more than 28,000 senior government officials who already must file public disclosures -- including the president, vice president, cabinet members, lawmakers and their staffs -- to report all trades valued at $1,000 or more within 30 days. The rule wouldn’t apply to widely held investment funds.
The measure would block bonuses for executives of Fannie Mae and Freddie Mac while the mortgage-financing agencies remain in government conservatorship.
Yesterday, the Gallup poll released a survey showing that 82 percent of Americans disapprove of the job Congress is doing while 12 percent approve. The poll was conducted March 8-11.
The public approval rating is “essentially flat,” Gallup said, compared with the 10 percent approval rating in its February poll, a record low.
CBS’s “60 Minutes” reported in November that some members of Congress, including House Speaker John Boehner, an Ohio Republican, and Minority Leader Nancy Pelosi, a California Democrat, bought stock in companies while legislation that might affect those businesses was being debated. Both said they did nothing wrong.
Republican Scott Brown of Massachusetts and New York Democrat Kirsten Gillibrand introduced Senate bills to ban congressional insider trading within a week after the “60 Minutes” report. The two measures were folded into the initial draft of S. 2038.
“It’s kind of a no-brainer for me,” Brown said after the vote.
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