Calls to ban members of Congress and their families from trading or owning stocks continue to grow, and Democratic Representative Mike Levin of California said all elected officials, regardless of party, should agree to the measure.
“No member of Congress should be allowed to take material non-public information obtained in the course of their job and use that information to trade stocks,” Levin told CNBC Washington correspondent Emily Wilkins at the CNBC CFO Council Summit in Washington, D.C., on Wednesday. “It’s outrageous,” he said.
On Tuesday, Florida Republican Rep. Anna Paulina Luna filed an expulsion petition seeking to force a vote on a bipartisan bill that would introduce such a measure.
The bill, called the Restoring Confidence in Congress Act, was introduced in September and would prohibit members, their spouses and dependent children from owning, purchasing or trading individual stocks or other prohibited assets while in office, and would require them to sell any stocks, options, futures or commodities they hold after being sworn into office.
Levin said he has seen members of Congress do that firsthand. He recalled a meeting the legislative body held in early 2020 regarding the broader impact of the coronavirus on the country.
“Every member of Congress had a different reaction to this,” Levin said. “My reaction was to call my wife and tell her to go to Costco and buy some hand sanitizer and Clorox wipes. Others called their stockbrokers and said, ‘Either short cruise ships or buy Pfizer.’ That’s wrong, fundamentally wrong.”
Levin said the current stock law passed in 2012, which imposes insider trading laws on members of Congress and government officials and requires transparency in stock transactions, is “very weak and ineffective.”
“There are no timestamps to tell you when people bought or sold. There are only ranges and dates,” he said. “It’s very difficult to determine exactly who did what.”
Asked if he supported Luna’s discharge petition, Levin said Democrats will be consulting with Rep. Chip Roy (R-Texas) and Rep. Seth Magaziner (D-R.I.), co-chairs of the Restoring Trust Act in Congress, to make sure the bill “can actually become law.”
“I don’t care if Democrats are doing it or Republicans are doing it. It’s wrong,” Levin said. “In my opinion, the only way to stop it is to ban it.”
Levin said that when he decided to run for Congress in 2017, he and his wife decided to sell all of their individual stock holdings and instead put the money into an equity mutual fund, a decision that he said “worked out well.”
“That doesn’t mean I can’t participate in the growth of the market, but I’m not going to take advantage of the material non-public information I received as a member of Congress,” he said. “That’s fundamentally wrong and everyone should agree with it.”
