Ban Congressional Stock and Crypto Trading

Insider Trading in Plain Sight: The Congressional Stock Trading Scandal

Members of Congress make policy decisions affecting entire industries while simultaneously trading stocks in those same industries based on non-public information unavailable to ordinary investors. This is not speculation. This is documented fact. A 2022 New York Times analysis found that ninety-seven members of Congress—nearly one-fifth of elected representatives and senators—made over 3,700 trades between 2019 and 2021 that could amount to conflicts of interest based on their committee assignments.¹ Democratic lawmakers’ portfolios increased an average of thirty-one percent in 2024 while Republicans saw twenty-six percent gains, compared to the S&P 500’s twenty-four percent rise.² Representative Nancy Pelosi’s portfolio surged sixty-five percent. Representative Brian Higgins achieved returns of 238 percent.² These are not the results of casual investors. These are the returns of people trading with information advantages.

The problem transcends party affiliation. The New York Times analysis found trades split evenly along partisan lines: forty-nine Republicans and forty-eight Democrats.¹ Ninety-five percent of current legislators own stock, with majorities of both parties holding equities whose value depends on legislation those same members vote on.³ When members of the House Financial Services Committee trade bank stocks, when Armed Services Committee members trade defense contractor stocks, when Energy and Commerce Committee members trade pharmaceutical stocks, the conflict of interest could not be more obvious. Yet this behavior continues, largely unchecked, year after year. <!–

The COVID-19 Trading Scandal

The COVID-19 pandemic exposed the most egregious examples of this legalized corruption in recent memory. In early 2020, as the coronavirus emerged as a global threat, senators received classified briefings about the coming pandemic’s severity before the public understood the danger. Within days of these briefings, several senators made highly suspicious trades. Senator Richard Burr of North Carolina sold over $1.72 million in stock on February 13, 2020, including stakes in hotel chains Wyndham and Extended Stay America—industries certain to be devastated by pandemic lockdowns.⁴ Senator Kelly Loeffler of Georgia and her husband, chairman of the New York Stock Exchange, sold millions in stock starting January 24, the very day the Senate Health Committee hosted a private briefing on coronavirus.⁴ Senator James Inhofe of Oklahoma sold as much as $400,000 in equities on January 27.⁴

These senators possessed information that the public lacked. They attended classified briefings describing the pandemic’s likely trajectory while publicly downplaying the threat. Senator Burr, chairman of the Senate Intelligence Committee, assured Americans in a February 7 op-ed that the country was “better prepared than ever before” to face the coronavirus threat.⁴ Meanwhile, according to NPR, he privately warned a group of well-connected constituents at a social club luncheon that the virus was “much more aggressive in its transmission than anything that we have seen in recent history” and would “probably be more akin to the 1918 pandemic.”⁴ Days after that private warning, Burr sold over a million dollars in stocks. This is insider trading. The fact that no senator faced criminal prosecution for these trades demonstrates that current law provides insufficient deterrence.

The FBI executed a search warrant for Senator Burr’s cellphone in May 2020, and the Department of Justice closed investigations into Senators Loeffler, Feinstein, and Inhofe without charges, though the Ethics Committee later dismissed allegations.⁴ The message was clear: even during a pandemic killing hundreds of thousands of Americans, even after receiving classified briefings unavailable to the public, even after making trades worth millions based on that information, members of Congress face no meaningful accountability. The system is broken. –>

The STOCK Act: A Toothless Law

Current law supposedly addresses congressional stock trading through the Stop Trading on Congressional Knowledge (STOCK) Act, enacted in 2012 following insider trading scandals during the Great Recession.³ The STOCK Act requires members to report stock trades within forty-five days and prohibits using non-public information for private profit. In practice, the law has proven utterly toothless. First-time violators face fines of merely $200—a trivial penalty compared to potential profits of thousands or millions of dollars from well-timed trades.³ During the 117th Congress alone, seventy-eight members violated the STOCK Act by filing late disclosures.⁵ Representative Byron Donalds of Florida failed to timely disclose over one hundred stock transactions worth up to $1.6 million.⁵ Representative Jared Moskowitz of Florida made over eighty late disclosures of trades in companies including PepsiCo, T-Mobile, and Nike.⁵

Most damningly, not a single member of Congress has ever been prosecuted for insider trading under the STOCK Act.³ Zero prosecutions. The law permits members to hide their stock holdings through complex ownership structures, making enforcement difficult even when violations occur.³ Campaign Legal Center filed fifteen complaints representing between $14.3 million and $52.1 million in undisclosed or untimely trades.³ Many lawmakers disclose trades months late, knowing they face only $200 penalties regardless of the violation’s magnitude.⁵ Late reports defeat the STOCK Act’s entire purpose, which is enabling public scrutiny of potential conflicts before trades influence policy decisions. When disclosure comes months after trades occur, the public learns about conflicts only after damage is done.

The depth of potential conflicts becomes apparent when examining how members’ portfolios align with their committee assignments. Of the fifty members of Congress most active in stock trading, forty-four bought or sold securities in companies over which their committee assignments gave them knowledge or influence.¹ Members of the Armed Services Committees trade defense contractor stocks while voting on Pentagon budgets and weapons programs. Financial Services Committee members trade bank stocks while regulating the banking industry. Energy and Commerce Committee members trade pharmaceutical stocks while considering drug pricing legislation and FDA oversight. These are not hypothetical conflicts. These are documented trades creating obvious incentives to prioritize industry profits over public welfare.

Evidence of Information Advantages

Academic research on congressional stock trading performance presents mixed findings, though the preponderance of evidence suggests that members possess information advantages. Early studies found that prior to the STOCK Act’s passage, portfolios mimicking senators outperformed the market by approximately twelve percent annually, while House members’ investments outperformed by approximately six percent annually.² Research covering 1993 to 1998 showed U.S. senators outperforming the broader market by about twelve percent per year.² More recent analysis found that a third of the one hundred members of Congress who reported financial transactions in 2023 beat the S&P 500, with notable performers including Representative Pelosi at sixty-five percent, Representative Dan Crenshaw at thirty-eight percent, and Senator Susan Collins at fifty-five percent.²

Some academic studies conclude that members no longer trade with information advantages in the post-STOCK Act period, suggesting that between 2004 and 2008 the average member would have earned higher returns in a passive index fund.² However, other research presents evidence that U.S. Senators still make informed trades after the STOCK Act’s enactment.² The fact that investors have created exchange-traded funds with tickers NANC and KRUZ specifically tracking Democratic and Republican congressional trades, and that an app called Autopilot allows investors to follow politicians’ stock trades, demonstrates that market participants believe congressional trading patterns contain valuable information.² If congressional trades were truly no more informed than those of ordinary investors, no rational market participant would pay fees to track and mimic those trades.

The Cryptocurrency Dimension

The emergence of cryptocurrency adds new dimensions to congressional conflicts of interest. Ten members of Congress hold between $750,000 and $2 million in cryptocurrency assets.³ Representative Ro Khanna introduced legislation in November 2025 that would ban trading and ownership of digital assets by anyone in elected office, recognizing that cryptocurrency’s regulatory framework remains unsettled and that members voting on crypto regulation should not simultaneously hold crypto investments.⁶ The proposed Ban Crypto Corruption Act would prohibit the President, Vice President, members of Congress, candidates for public office, elected officials, high-ranking executive branch employees, and their immediate family members from issuing, sponsoring, or endorsing digital assets including cryptocurrency, meme coins, stablecoins, tokens, NFTs, digital trading cards, and decentralized finance platforms.⁶

Representative Khanna’s legislation would require politicians and family members to place digital assets they already hold in qualified blind trusts inaccessible during candidacy, public service, and two years after service ends.⁶ The legislation would mandate full and timely disclosure of all cryptocurrency transactions by politicians and their families.⁶ Senator Michael Bennet introduced similar legislation, the Stop Trading Assets Benefiting Lawmakers’ Earnings while Governing Exotic and Novel Investments for the United States (STABLE GENIUS) Act, to prevent elected officials and candidates from issuing or endorsing digital assets while preventing officials from making legislative or policy decisions influenced by digital assets they hold.⁶ The Senate passed the GENIUS Act in a 68-30 vote, marking the first time the Senate approved major legislation regulating digital assets, including language prohibiting members of Congress or senior executive branch officials from issuing payment stablecoin products during public service.⁶

The cryptocurrency sector’s regulatory uncertainty makes congressional crypto holdings particularly problematic. Unlike established stock markets with decades of regulatory frameworks, cryptocurrency regulation remains contested, with fundamental questions about classification, taxation, consumer protection, and financial stability unresolved. Members voting on whether to regulate crypto as securities, commodities, or currency have obvious conflicts when they personally hold crypto assets whose value depends on regulatory outcomes. The spectacular collapse of FTX and conviction of its founder Sam Bankman-Fried—who donated extensively to congressional candidates—illustrates the sector’s volatility and the risks of regulatory capture. Members holding crypto investments face temptations to support industry-friendly regulation regardless of consumer protection or financial stability concerns.

Federal Legislation: Bipartisan Momentum for Reform

Representative Alexandria Ocasio-Cortez has been among the most consistent advocates for banning congressional stock trading. In September 2025, she joined a bipartisan coalition including conservative members to announce the Restore Trust in Congress Act, legislation prohibiting members of Congress, their spouses, and dependents from owning or trading individual stocks.⁷ The bill establishes a ten percent penalty on the asset value of prohibited trades, plus disgorgement of profits, with fines publicly disclosed.⁷ Representative Ocasio-Cortez emphasized the bipartisan nature of reform efforts: “this issue has brought so many of us across the political spectrum together” in pursuit of elected representatives prioritizing constituents’ interests.⁷ She credited negotiations among various bills’ sponsors for producing “a product that is legitimately stronger” than any individual proposal.⁷

In January 2025, Representatives Ocasio-Cortez, Brian Fitzpatrick, Cory Mills, and Raja Krishnamoorthi introduced the Bipartisan Restoring Faith in Government Act with similar provisions.⁸ This continued work that began in 2021 when Representatives Krishnamoorthi, Ocasio-Cortez, and Neguse introduced the Ban Conflicted Trading Act, legislation preventing members and senior congressional staff from profiting through individual stock trades while in office.⁹ The Ban Conflicted Trading Act would give new members six months to sell holdings and sitting members six months from enactment, permit members to retain investments without trading or transfer holdings to blind trusts, allow continued investment in diversified mutual funds and exchange-traded funds, and prohibit members from serving on corporate boards while in office.⁹

Representative Ocasio-Cortez stated plainly: “Members of Congress should not be allowed to buy and sell individual stock. We are here to serve the public, not to profiteer.”⁹ This framing captures the fundamental issue. Public service means prioritizing public welfare over private gain. When members trade stocks in industries they regulate, private financial interests inevitably conflict with public responsibilities. The temptation to favor policies benefiting personal portfolios over policies serving constituents corrupts the legislative process even when individual members act in good faith. The mere appearance of conflict undermines public trust in democratic institutions.

Representative Krishnamoorthi emphasized that sponsors introduced the Ban Conflicted Trading Act following reports that senators sold millions in stocks based on information from closed-door coronavirus briefings.⁹ The COVID-19 trading scandal crystallized public outrage, but the underlying problem predated the pandemic and continues today. Every day that Congress permits members to trade stocks in industries they regulate, conflicts of interest shape legislative outcomes. Every committee hearing where members question executives while holding stock in those executives’ companies creates incentives to avoid tough scrutiny. Every vote on industry regulation where members profit from industry success undermines democratic legitimacy.

Overwhelming Public Demand for Action

Public opinion overwhelmingly supports banning congressional stock trading across partisan lines. A survey by the Program for Public Consultation at the University of Maryland found eighty-six percent support prohibiting stock trading in individual companies by members of Congress, including eighty-seven percent of Republicans, eighty-eight percent of Democrats, and eighty-one percent of independents.¹⁰ A national survey by Navigator Research found eighty-nine percent of Democrats, ninety-two percent of Republicans, and ninety percent of independents support banning congressional stock trading.¹⁰ A Convention of States Action poll found that seventy-six percent of voters believe lawmakers and spouses have an “unfair advantage” in the stock market, with seventy percent of Democrats, seventy-eight percent of Republicans, and nearly eighty percent of independents saying members should not be allowed to trade stocks.¹⁰

Multiple polls consistently show roughly seventy to ninety percent of Americans supporting a ban on congressional stock trading, with strong majorities across all political affiliations.¹⁰ This represents one of the few policy issues commanding truly bipartisan public support in an era of deep partisan division. When Republicans, Democrats, and independents agree with such overwhelming majorities, congressional inaction becomes indefensible. The failure to enact a trading ban reveals that Congress prioritizes members’ personal financial interests over both public welfare and public opinion. This is not democracy. This is oligarchy.

Some opponents argue that stock trading bans would discourage qualified candidates from running for Congress or deprive members of investment opportunities available to other Americans. These arguments are unpersuasive. First, public service requires sacrifice. Members already accept restrictions on outside income, employment, and political activities that ordinary citizens do not face. Prohibiting stock trading in industries members regulate imposes no greater burden than existing ethics rules. Second, members can still invest in diversified mutual funds and exchange-traded funds, allowing portfolio growth without creating conflicts of interest tied to specific companies. The restriction applies narrowly to individual stock trading, not to all investment.

Third, if the prospect of foregoing stock trading during congressional service discourages someone from running for office, that person likely prioritizes personal enrichment over public service and should not serve in Congress. We want representatives motivated by desire to improve constituents’ lives, not by desire to profit from insider information. Fourth, the “qualified candidates” argument ignores that many wealthy Americans serve in Congress while millions of working-class Americans could serve competently but cannot afford campaigns. The real barrier to qualified candidates is campaign finance, not stock trading restrictions. If we are concerned about attracting qualified candidates, we should establish public campaign financing, not permit insider trading.

The blind trust argument—permitting members to hold stocks but requiring professional management without member input—sounds reasonable but proves inadequate in practice. Members know which industries benefit from pending legislation even without knowing specific holdings. A member on the Armed Services Committee supporting increased defense spending knows that decision likely benefits defense contractor holdings regardless of whether they personally selected those stocks. Members maintain relationships with trustees and can signal preferences indirectly. The complexity of determining whether particular communications violate blind trust rules creates enforcement challenges. Most importantly, blind trusts address only direct conflicts while ignoring broader problems: when members profit from industries they regulate, public perception of corruption persists even with technical compliance.

The strongest argument for a trading ban is not eliminating actual insider trading, though that is important. The strongest argument is eliminating conflicts of interest that corrupt legislative judgment and restore public trust in democratic institutions. When members hold pharmaceutical stocks, they face subconscious bias toward policies benefiting pharmaceutical companies even without consciously trading on insider information. When members hold defense contractor stocks, they face incentives to support military spending regardless of strategic necessity. When members hold bank stocks, they hesitate to support strong financial regulation. These biases operate regardless of whether members ever exploit insider information for trading purposes.

Campaign Legal Center research shows the breadth of the problem: ninety-five percent of current legislators own stock, with stock ownership splitting fifty-nine percent Republican and forty-one percent Democratic.³ This is not a problem of a few bad actors. This is systemic corruption embedded in congressional culture. Nearly every member faces conflicts between personal financial interests and public responsibilities. The fact that this has become normalized—that members casually discuss stock portfolios, that financial disclosure forms document thousands of trades, that STOCK Act violations draw $200 fines but no serious consequences—demonstrates how thoroughly the revolving door between public service and private enrichment has corrupted Congress.

The comparison to other democracies reveals American exceptionalism in the worst sense. Many democracies impose far stricter restrictions on elected officials’ financial activities, recognizing that preventing conflicts of interest protects democratic legitimacy. The United States permits a level of congressional stock trading that would be scandalous in peer nations. This is not because American democracy is stronger or American politicians more ethical. This is because American politicians have successfully resisted reforms that other democracies implemented decades ago. The question is not whether reform is possible. The question is whether Congress values public trust more than personal profit.

Multiple bills pending in Congress would ban or substantially restrict stock trading. The Bipartisan Restoring Faith in Government Act, the Ban Conflicted Trading Act, the Restore Trust in Congress Act, the Ban Congressional Stock Trading Act introduced by Senators Bennet, Ossoff, and Kelly, Representative Khanna’s Ban Crypto Corruption Act, and Senator Bennet’s STABLE GENIUS Act all represent serious legislative efforts with bipartisan cosponsors.⁶⁷⁸⁹ House Speaker Mike Johnson supports a ban, House Minority Leader Hakeem Jeffries has endorsed legislation, and President Trump has backed the idea.¹¹ Senate Majority Leader John Thune has expressed concerns and has not committed to floor consideration, illustrating that leadership opposition represents the primary obstacle.¹¹

The Path Forward: Comprehensive Reform

The path forward is clear. Congress must pass comprehensive legislation banning members, spouses, and dependent children from trading individual stocks, requiring divestment or transfer to genuine blind trusts within six months, permitting only diversified mutual funds and exchange-traded funds, prohibiting all cryptocurrency trading and requiring crypto holdings to be placed in blind trusts, banning service on corporate boards, establishing penalties of at least ten percent of asset value plus profit disgorgement for violations, mandating full and timely disclosure of all financial transactions, and creating robust enforcement mechanisms with meaningful criminal penalties for insider trading.

The legislation should cover not only members but also senior congressional staff, who possess similar access to non-public information and face similar conflicts. The six-year restriction on senior staff lobbying in the Close the Revolving Door Act should be paired with restrictions on staff trading.¹² Staff members draft legislation, attend briefings, and access classified information while typically earning far less than members, creating even stronger incentives for using insider information to supplement modest salaries. Comprehensive reform must address both member and staff trading to eliminate conflicts throughout Congress.

Cryptocurrency provisions must be particularly strong given the sector’s regulatory uncertainty. No member or family member should hold any cryptocurrency while serving in Congress or for two years afterward, with extremely narrow exceptions for holdings placed in true blind trusts where trustees have complete discretion. Members should be prohibited from issuing, endorsing, sponsoring, or promoting any cryptocurrency, meme coin, stablecoin, token, NFT, or digital asset. The temptation for members to launch crypto tokens leveraging their names and positions for personal profit is obvious and must be explicitly prohibited with criminal penalties for violations.

Enforcement must be dramatically strengthened. The $200 STOCK Act penalty should be increased to a minimum of ten percent of the transaction value or $10,000, whichever is greater, for first violations, with penalties escalating for repeat violations. Criminal penalties for insider trading must be vigorously enforced, with the Department of Justice establishing a dedicated unit investigating congressional trading. The House and Senate Ethics Committees must be empowered to investigate violations proactively rather than waiting for complaints, with adequate staffing and resources. Ethics Committee investigations and findings should be made public unless classified information requires confidentiality. Members who repeatedly violate reporting requirements should face expulsion votes.

The most powerful enforcement mechanism is electoral accountability. Voters must make stock trading a voting issue. Every candidate should be asked whether they support a comprehensive trading ban and whether they will pledge not to trade stocks if elected. Candidates refusing to make that pledge should be pressed to explain why they need to trade stocks while serving in Congress. Primary challengers should make incumbent trading records central campaign issues. Organizations rating congressional candidates should make support for a trading ban a threshold requirement for endorsements. Unions, progressive groups, and grassroots organizations should unify behind this reform as fundamental to broader progressive policy goals.

The connection between stock trading and policy outcomes cannot be overstated. When members profit from pharmaceutical companies, Medicare-for-all faces additional obstacles. When members hold defense contractor stocks, military spending receives less scrutiny. When members own fossil fuel stocks, climate legislation struggles. When members hold tech company stocks, antitrust enforcement weakens. The stock trading ban is not merely a good government reform. It is a prerequisite for achieving progressive policy goals in healthcare, climate, economic justice, and corporate accountability. Every policy battle faces an additional barrier when members’ personal financial interests align with corporate interests opposing reform.

Representative Ocasio-Cortez’s statement that “We are here to serve the public, not to profiteer” should be uncontroversial.⁹ Yet the fact that it needs to be said, that legislation must be introduced to prevent profiteering, that years pass without action despite overwhelming public support, reveals how deeply corruption has penetrated congressional culture. The normalization of insider trading, the casual acceptance of conflicts of interest, the trivialization of STOCK Act violations—these are symptoms of institutional decay. A democracy cannot function when elected representatives prioritize personal enrichment over public welfare.

The ninety-seven members identified by the New York Times making over 3,700 potentially conflicted trades represent nearly one-fifth of Congress.¹ The seventy-eight members who violated the STOCK Act in just the 117th Congress.⁵ The zero prosecutions for insider trading despite obvious violations.³ The fifty-four percent returns achieved by tracking a single member’s trades.¹³ The classified pandemic briefings followed by millions in suspicious trades.⁴ The ten percent penalty proposed in the Restore Trust in Congress Act.⁷ The eighty-six percent public support across party lines.¹⁰ These are not abstract statistics. These are measures of democratic failure.

The choice before Congress is simple. End stock trading by members, spouses, and dependents, or admit that personal profit matters more than public service. Enact meaningful penalties and enforcement, or acknowledge that ethics rules are performative theater. Listen to the eighty-six percent of Americans demanding reform, or confirm that public opinion is irrelevant when it conflicts with congressional self-interest. There is no middle ground. There is no compromise that preserves the fundamental corruption while addressing cosmetic concerns. Either Congress bans stock trading, or Congress accepts that it has been captured by members’ personal financial interests.

Representative Krishnamoorthi, Representative Ocasio-Cortez, Representative Neguse, Representative Khanna, Senator Bennet, Senator Ossoff, and other sponsors of trading ban legislation deserve credit for persistence in the face of institutional resistance. Their willingness to challenge congressional culture and demand that colleagues choose between public service and personal profit represents genuine leadership. But individual leadership is insufficient. This requires a movement. Voters must demand that every member support a comprehensive trading ban. Organizations must make this a litmus test issue. Media must investigate and report trading violations. Prosecutors must enforce insider trading laws. The public must refuse to accept that insider trading by members of Congress is normal, legal, or tolerable.

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