Pelosi evasive on extending individual stock trading ban to spouses of lawmakers

Democrats are weighing whether to extend an individual stock trading ban to spouses of lawmakers. 

The Ban Conflicted Trading Act "prohibits a Member of Congress or certain congressional officers or employees from (1) purchasing or selling specified investments, (2) entering into a transaction that creates a net short position in a security, or (3) serving as an officer or member of any board of any for-profit entity."

The legislation in its current form would not apply to the spouses of lawmakers. House Speaker Nancy Pelosi's husband Paul has made headlines over the years with his millions of dollars in stock purchases, particularly with technology companies.

Pelosi was asked if the ban that the Democrats pass in the House will cover spouses.

"I'm a big believer in our committees, and we've tasked the House Administration Committee to review the options that members are putting forth — and they have different views on the subject," Pelosi said at a news conference this week. "But I'd said that certain criteria that I wanted to see was whatever — whatever design they have for that, that's one. But the other is, we have to tighten the fines on those who violate the STOCK Act. It's apparently not sufficient to deter behavior."

 

Pelosi pointed out that the judicial branch, specifically the Supreme Court, currently have no disclosure rules around stock purchases.  

"It has no reporting of stock transactions," she said. "And yet it makes important decisions every day. I do believe in the integrity of people in public service. I want the public to have that understanding. We have to do this to deter something that we see as a problem, but it is a confidence issue. And if that's what the members want to do, then that's what we will do."

Pelosi said that when members of the executive branch "divest of their stock" they don't pay capital gains tax. 

 

"But it's complicated, and members will figure it out, and then we'll go forward with what the consensus is," Pelosi said. 

Pelosi's office did not provide additional comment on the potential stock trade ban in Congress. A spokesperson referred Just the News to Pelosi's most recent public remarks on stock trading.

A group of Senate Democrats are reportedly in the process of drafting legislation that would extend a stock trading ban to spouses as well. The text of the bill has not been publicly released yet.

Virginia Democratic Sen. Mark Warner sits on the Senate Rules and Administration, Finance, and Budget committees. Just the News asked Warner if he thinks spouses should be covered by an individual stock trade ban.

"This is a position I've had since I've been governor," Warner said during a news conference this week. "I put my assets in a trust. When I was governor, there was no legal requirement to do so. I've been blessed enough to have a pretty successful business career and owned a lot of entities. I wanted to put it in a blind trust, and I've continued that, that trust arrangement since I've been senator.

"And so putting a stronger legislation in place I support. I want to see all the various bills coming forward. You know, what do you do with spouses? What do you do with kids? What do you do if a child gets an inheritance?" 

Warner noted that he was a venture capitalist for 20-plus years.

"The idea of a venture capitalist, you invest in a startup company, that startup company is not liquid, if that startup company ends up becoming successful and goes public, at some point, as an early investor, you get distributed public stock," Warner said.

"My policy, and I think it is the appropriate policy, is that whenever you get distributed public stock, you get rid of it and sell it so you don't have, again, any personal interest in how that company goes," Warner said. "But you wouldn't want to put such a prohibition that people couldn't dispose of assets that go public, so the devil is in the details here." 

Avoiding a direct answer on whether spouses should be barred from individual stock trading, Warner offered: "The idea that we need to install greater confidence that senators and congressmen are not trading on their insider information or knowledge. I absolutely support that, and that has been my policy — not to trade any public stock —   since I've been in public life."