What’s in your wallet?
November 22, 2010
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It Isn’t Insider Trading When Your Senator Does It: Ann Woolner
Your senator learns that a much- maligned weapons system now has enough votes for funding. Before the news gets to a reporter, he buys shares in the arms manufacturer for a quick, handsome profit.
What’s wrong with this picture? Nothing, according to the law. Nor would it be illegal for him to tip someone else, say, his largest campaign contributor.
Laws that criminalize insider trading cover corporate insiders and those they tip, but not specifically Congress. And while scholars differ on whether existing law could be applied on Capitol Hill, it hasn’t been.
It’s a gap in the law that two members of Congress have been trying for years to plug, to no avail. Congress is famous for telling others what they can and can’t do. When it comes to proscribing its own conduct, it’s a different story.
This week the Wall Street Journal reported that during the past two calendar years, 72 congressional aides from both parties made trades in companies that their bosses’ help oversee. Among them are top advisers to Senate Majority Leader Harry Reid and House Speaker Nancy Pelosi. Their timely investments proved profitable, but the staffers deny the trades sprung from inside knowledge, the Journal reported.
Congressional Members’ Personal Wealth Expands Despite Sour National Economy