The House on Thursday passed a bill that would ban congressional insider trading. The STOCK Act passed overwhelmingly, 417-2, despite some partisan disagreements over its scope.
With congressional approval at all-time lows, the bill was widely seen by lawmakers as a small step in restoring public confidence. But differences remain to be worked out with a Senate measure, passed last week, before a bill could be sent to President Obama.
Many experts say it's already illegal for members of Congress to trade stocks based on non-public information they obtain because of their role as lawmakers. But a report last fall on CBS's "60 Minutes" raised questions about whether they are actually covered by insider trading laws.
The bill, which has languished in obscurity for years, gained more than 200 co-sponsors virtually overnight after the "60 Minutes" report.
"The intent is to get members of Congress not to trade on their information that they have through their work," said Rep. Louise Slaughter, D-N.Y., an original author of the measure.
In addition to explicitly banning insider trading by members of Congress and their staffs, members of Congress would be required to report financial transactions within 30 days, with information about trades posted online. Currently, paper disclosures are only required once a year.
The House bill left out a Senate-passed provision that would require people who work in the political intelligence industry to register much like lobbyists. Political intelligence firms gather information from members of Congress and their staffs and sell it to hedge funds and other investors looking for an advantage.
An earlier version of the House bill contained the provision, but when Majority Leader Eric Cantor, R-Va., introduced the version that the House ultimately approved, it had been removed. Cantor said the political intelligence provision raised too many questions and could have unintended consequences.
The likely next step is a conference committee, where the differences between the two bills could be worked out.