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House Minority Leader Kevin McCarthy is considering limiting or prohibiting members of Congress from trading individual stocks while in elective office if Republicans win the majority in November, a source familiar with the matter told FOX Business.
The plan, first reported by Punchbowl News, puts McCarthy, R-Calif., directly at odds with House Speaker Nancy Pelosi, D-Calif., who has defended the practice – even though critics say it gives lawmakers the chance to profit off inside information gleaned through their official duties.
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"We are a free market economy. They should be able to participate in that," Pelosi told reporters on Dec. 15. Pelosi does not own any stock herself, but her husband holds tens of millions of dollars worth of stocks and options in companies like Apple, Disney, Amazon and Google.
House Minority Leader Kevin McCarthy talks to reporters at the Capitol in Washington on Sept. 29, 2021. (AP Photo/J. Scott Applewhite / Associated Press)
The California Democrat has previously said she has no prior knowledge or involvement in her husband's trading decisions.
Lawmakers' spouses are allowed to trade in companies or industries that their partner may help regulate. But under the STOCK Act, passed in 2012, it's illegal for members of Congress and their families to profit from inside information and it requires lawmakers to report stock trades to Congress within 45 days. In some recent cases, lawmakers have failed to report their trades altogether.
"We have a responsibility to report," Pelosi said. "If people aren’t reporting they should be."
Pelosi is worth an estimated $114 million, according to her 2018 personal financial disclosure, making her the sixth-richest member of the House and the 10th richest member of Congress, according to data tracked by the Center for Responsive Politics.
Other Democrats, such as Rep. Alexandria Ocasio-Cortez, D-N.Y., Sen. Elizabeth Warren, D-Mass., and Sen. Jon Ossoff, D-Ga., have voiced support for banning trading among members of Congress.
House Speaker Nancy Pelosi meets with reporters to discuss President Joe Biden's domestic agenda at the Capitol in Washington, Sept. 8, 2021. (AP Photo/J. Scott Applewhite / AP Newsroom)
McCarthy's announcement comes just a few days after news that Ossoff is planning to introduce legislation that would prohibit members of Congress from holding or trading individual stocks while in elective office.
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A source familiar with the matter told FOX Business that the ethics bill, which the freshman Georgia Democrat hopes to file as soon as he secures a Republican cosponsor, would also target conflicts of interest by making it illegal for lawmakers' spouses and family members to trade stocks while in office, the source said.
It may also require lawmakers to put their financial assets in a blind trust – something Ossoff did a few months after he was elected in January 2021. Ossoff's blind trust contributed to a net worth somewhere between $2 million and $7.3 million as of late 2020.