Bill To Ban Congressional Insider Trading Moves Forward

In an effort that has reignited Washington’s war on corruption, Senator Josh Hawley has revived the Preventing Elected Leaders from Owning Securities and Investments (PELOSI) Act, a bill to bar members of Congress and their spouses from trading or holding personal stocks whilst in office.

Named as a biting critique of former-House Speaker Nancy Pelosi, the bill seeks to restore public trust in government, which many Americans now view as tainted by self-enrichment financial strategies. President Donald Trump has even issued a strong signal of support for the bill, calling for investigations of figures like Pelosi.
The PELOSI Act is straightforward and uncompromising; it prohibits members of Congress and their spouses from buying, selling, or holding individual stocks while in office and only permits US Treasury bonds, diversified mutual funds, or exchange-traded funds (ETFs).

Members of Congress who violate the ban would be required to forfeit profits to the US Treasury and be penalized by congressional ethics committees. Incumbents would have 180 days to comply with the mandate, and a speedy transition away from a system that incentivizes the misuse of privileged information would be facilitated.
Hawley’s bill addresses an age-old issue: the public, and frequently real, perception that elected officials trade their access to nonpublic information for personal wealth.

Congress members should be representing the people they were elected to serve, not use the exclusive information they know to day trade.

When speaking with Jesse Watters, Hawley explained that, “The point of this bill is to ban members of Congress from trading on the information that only they have. I’ve supported this bill for years, Jesse. I think we called it the Pelosi Act. It is named for her because she is the poster child of this kind of behavior. It ought to be illegal and it ought to be prosecutable.”

One of the bill’s sponsors, Nancy Pelosi, has been a target for criticism for years over stock trading by her family. Her husband, Paul Pelosi, who is also a venture capitalist, has made his fortune on trades that critics attribute suspicious timing to congressional activity

For instance, in 2022, Paul Pelosi purchased millions of shares of semiconductor stocks as Congress prepared to vote on a bill to subsidize the chip industry. His portfolio in 2024 allegedly saw a mind-boggling 54% return, dwarfing many hedge funds and market indexes. Pelosi and her supporters claim these trades are legal under the STOCK Act and that they have done nothing wrong, but appearances are unfavorable. The American people, already distrustful of Washington’s honesty, perceive an elite system.

President Trump was outspoken in his encouragement of Hawley’s attempts, announcing to Time magazine, “I watched Nancy Pelosi get rich with insider information, and I would be okay with it. If they send that to me, I would do it.” He indicated in questioning that he would “absolutely” sign the PELOSI Act into law.

Trump went further, calling for an investigation into Pelosi’s trading activities, declaring, “Nancy Pelosi should be investigated because what she has the highest return of anybody practically in the history of Wall Street save a few. And how did that happen?”

The legislation has attracted bipartisan support, a reflection of widespread public calls for reform of America’s governing systems. Surveys across the board consistently register more than 80% of Americans in support of prohibiting congressional stock trading.

Even House Minority Leader Hakeem Jeffries has caught on, and symbolically departs from the Pelosi emphasis when lawmakers’ rights to participate in a “free market” were the main argument, but enemies of the bill are still protesting. For instance, Senators Rand Paul and Rick Scott have condemned the bill, arguing that enough exists already under insider trading statutes and disclosure obligations.
A 2022 New York Times investigation concluded that at least 97 congressional members reported trades that can coincided with the activities of their committees, raising potential conflicts of interest.

Whilst the PELOSI Act isn’t about punishing success; it’s about ensuring that public service doesn’t become a path to personal enrichment. As Hawley astutely pointed out, the briefings lawmakers receive are not covered by insider trading laws, “but nobody believes that the information we get isn’t valuable. It is quite valuable.”

Ultimately, President Trump calling for an investigation into Pelosi’s trades brings a sense of urgency to the debate and despite no concrete evidence being provided which proves the Pelosi’s have traded as insiders, there is a consistent pattern of how they have performed: they were consistently better than the market.

Republicans have also been criticized for utilizing information. One such example is of former Senator Richard Burr who came under fire for the sale of stocks following classified briefings amid the COVID-19 pandemic.

The PELOSI Act would do away with these loopholes, establishing a bright line standard equally applicable to all elected officials. As appealing as it is in a bipartisan fashion, the bill continues to encounter opposition from special interests within Congress. Hawley’s earlier attempts at passing such legislation went nowhere under the Biden administration, and even now some Republicans worry that it could be used to “target” people like Trump, who have single stocks.

Hawley responded by negotiating with Democrats to exempt Trump and Vice President JD Vance from divestment requirements while they remain in office during the current term. Members of Hawley’s party criticized the move but guaranteed passage in the Senate Homeland Security and Governmental Affairs Committee on a vote of 8-7.

In conclusion, the PELOSI Act is a challenge to Washington’s commitment to integrity and for the majority of Americans, it’s a matter of principle: government exists to serve people, not enrich leaders.

By banning congressional stock trading and penalizing wrongdoers, this bill sends a clear message that public office is a responsibility, not a cash-grab.

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