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S 1903 ISCommentsClose CommentsPermalink

112th CONGRESSCommentsClose CommentsPermalink

1st SessionCommentsClose CommentsPermalink

S. 1903CommentsClose CommentsPermalink

To prohibit commodities and securities trading based on nonpublic information relating to Congress, to require additional reporting by Members and employees of Congress of securities transactions, and for other purposes.CommentsClose CommentsPermalink

IN THE SENATE OF THE UNITED STATESCommentsClose CommentsPermalink

November 17, 2011CommentsClose CommentsPermalink

Mrs. GILLIBRAND (for herself, Mr. TESTER, Ms. STABENOW, Mr. DURBIN, Mrs. MCCASKILL, Ms. KLOBUCHAR, Mr. RUBIO, and Mr. BLUMENTHAL) introduced the following bill; which was read twice and referred to the Committee on Homeland Security and Governmental AffairsCommentsClose CommentsPermalink

A BILLCommentsClose CommentsPermalink

To prohibit commodities and securities trading based on nonpublic information relating to Congress, to require additional reporting by Members and employees of Congress of securities transactions, and for other purposes.CommentsClose CommentsPermalink

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,CommentsClose CommentsPermalink

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘Stop Trading on Congressional Knowledge Act’.CommentsClose CommentsPermalink

SEC. 2. NONPUBLIC INFORMATION RELATING TO CONGRESS AND OTHER FEDERAL EMPLOYEES.

(a) Commodities Transactions- Section 4c of the Commodity Exchange Act (7 U.S.C. 6c) is amended by adding at the end the following:CommentsClose CommentsPermalink





‘(h) Nonpublic Information-CommentsClose CommentsPermalink





‘(1) DEFINITIONS- In this subsection:CommentsClose CommentsPermalink





‘(A) AGENCY- The term ‘agency’ has the meaning given the term in section 551 of title 5, United States Code.CommentsClose CommentsPermalink





‘(B) MATERIAL NONPUBLIC INFORMATION- The term ‘material nonpublic information’--CommentsClose CommentsPermalink





‘(i) has the meaning given the term by the Commission by rule;CommentsClose CommentsPermalink





‘(ii) includes any information that--CommentsClose CommentsPermalink





‘(I) a member or employee of Congress, or an employee of an agency, as applicable, gains by reason of that position or employment; andCommentsClose CommentsPermalink





‘(II) the member or employee knows or should know has not been made available to the general public; andCommentsClose CommentsPermalink





‘(iii) includes information that--CommentsClose CommentsPermalink





‘(I) is routinely exempt from disclosure under section 552 of title 5, United States Code, or otherwise protected from disclosure by law (including Executive orders and regulations);CommentsClose CommentsPermalink





‘(II) is designated as confidential by an agency; orCommentsClose CommentsPermalink





‘(III) has not actually been disseminated to the general public and is not authorized to be made available to the public on request.CommentsClose CommentsPermalink





‘(2) NONPUBLIC INFORMATION RELATING TO CONGRESS- Not later than 270 days after the date of enactment of this subsection, the Commission shall by rule prohibit any person from buying or selling any commodity for future delivery or swap while the person is in possession of material nonpublic information relating to any pending or prospective legislative action relating to the commodity if--CommentsClose CommentsPermalink





‘(A)(i) the information was obtained by reason of the person being a Member or employee of Congress; orCommentsClose CommentsPermalink





‘(ii)(I) the information was obtained from a Member or employee of Congress; andCommentsClose CommentsPermalink





‘(II) the person knows that the information was so obtained; andCommentsClose CommentsPermalink





‘(B) the person acted with the intent to assist another person, directly or indirectly, to use the information to enter into, or offer to buy or sell the securities of such publicly traded company based on such information.CommentsClose CommentsPermalink





‘(3) NONPUBLIC INFORMATION RELATING TO OTHER FEDERAL EMPLOYEES- Not later than 270 days after the date of enactment of this subsection, the Commission shall by rule prohibit any person from buying or selling any commodity for future delivery or swap while the person is in possession of material nonpublic information derived from Federal employment and relating to the commodity if--CommentsClose CommentsPermalink





‘(A)(i) the information was obtained by reason of the person being an employee of an agency; orCommentsClose CommentsPermalink





‘(ii)(I) the information was obtained from an employee of an agency; andCommentsClose CommentsPermalink





‘(II) the person knows that the information was so obtained; andCommentsClose CommentsPermalink





‘(B) the person acted with the intent to assist another person, directly or indirectly, to use the information to enter into, or offer to buy or sell the securities of such publicly traded company based on such information.’.CommentsClose CommentsPermalink





(b) Securities Transactions-CommentsClose CommentsPermalink





(1) DEFINITIONS- As used in this subsection--CommentsClose CommentsPermalink





(A) the term ‘agency’ has the same meaning as in section 551(1) of title 5, United States Code;CommentsClose CommentsPermalink





(B) the term ‘Commission’ means the Securities and Exchange Commission; andCommentsClose CommentsPermalink





(C) the term ‘material nonpublic information’--CommentsClose CommentsPermalink





(i) has the meaning given that term by rule of the Commission; andCommentsClose CommentsPermalink





(ii) includes any information that a member or employee of Congress or an employee of an agency, as applicable, gains by reason of such position or employment, and that such member or employee knows or should know has not been made available to the general public, including information that--CommentsClose CommentsPermalink





(I) is routinely exempt from disclosure under section 552 of title 5, United States Code, or otherwise protected from disclosure by statute, Executive Order, or regulation;CommentsClose CommentsPermalink





(II) is designated as confidential by an agency; orCommentsClose CommentsPermalink





(III) has not actually been disseminated to the general public and is not authorized to be made available to the public on request.CommentsClose CommentsPermalink





(2) NONPUBLIC INFORMATION RELATING TO CONGRESS- Not later than 270 days after the date of enactment of this Act, the Commission shall, by rule, prohibit any person from buying or selling the securities or security-based swaps of any issuer while such person is in possession of material nonpublic information relating to any pending or prospective legislative action relating to such issuer, if--CommentsClose CommentsPermalink





(A)(i) such information was obtained by reason of such person being a Member or employee of Congress; orCommentsClose CommentsPermalink





(ii) such information was obtained from a Member or employee of Congress, and such person knows that the information was so obtained;CommentsClose CommentsPermalink





(B) the person acted with the intent to assist another person, directly or indirectly, to use the information to enter into, or offer to buy or sell the securities of such publicly traded company based on such information.CommentsClose CommentsPermalink





(3) NONPUBLIC INFORMATION RELATING TO OTHER FEDERAL EMPLOYEES- Not later than 270 days after the date of enactment of this subsection, the Commission shall, by rule, prohibit any person from buying or selling the securities or security-based swaps of any issuer while such person is in possession of material nonpublic information derived from Federal employment and relating to such issuer, if--CommentsClose CommentsPermalink





(A)(i) such information was obtained by reason of such person being an employee of an agency; orCommentsClose CommentsPermalink





(ii) such information was obtained from such an employee, and such person knows that the information was so obtained; andCommentsClose CommentsPermalink





(B) the person acted with the intent to assist another person, directly or indirectly, to use the information to enter into, or offer to buy or sell the securities of such publicly traded company based on such information.CommentsClose CommentsPermalink

SEC. 3. AMENDMENT TO THE RULES OF THE SENATE REGARDING FINANCIAL TRADING BASED ON NONPUBLIC INFORMATION.

Rule XXXVII of the Standing Rules of the Senate is amended by--CommentsClose CommentsPermalink





(1) redesignating paragraph 15 as paragraph 16; andCommentsClose CommentsPermalink





(2) inserting at the end the following:CommentsClose CommentsPermalink





‘15. A Member, officer, or employee of the Senate shall not--CommentsClose CommentsPermalink





‘(1) disclose material nonpublic information relating to any pending or prospective legislative action relating to any publicly traded company if that Member, officer, or employee acts with the intent to assist another person, directly or indirectly, to use the information to enter into, or offer to buy or sell the securities of such publicly traded company based on such information; orCommentsClose CommentsPermalink





‘(2) disclose material nonpublic information relating to any pending or prospective legislative action relating to any commodity if that Member, officer, or employee acts with the intent to assist another person, directly or indirectly, to use the information to enter into, or offer to buy or sell the securities of such publicly traded company based on such information.’.CommentsClose CommentsPermalink

SEC. 4. TIMELY REPORTING OF FINANCIAL TRANSACTIONS.

(a) Reporting Requirement- Section 103 of the Ethics in Government Act of 1978 is amended by adding at the end the following subsection:CommentsClose CommentsPermalink





‘(l) Within 90 days after the purchase, sale, or exchange of any stocks, bonds, commodities futures, or other forms of securities that are otherwise required to be reported under this Act and the transaction of which involves at least $1,000 by any Member of Congress or officer or employee of the legislative branch required to so file, that Member, officer, or employee shall file a report of that transaction with the Clerk of the House of Representatives in the case of a Representative in Congress, a Delegate to Congress, or the Resident Commissioner from Puerto Rico, or with the Secretary of the Senate in the case of a Senator.’.CommentsClose CommentsPermalink





(b) Effective Date- The amendment made by subsection (a) shall apply to transactions occurring on or after the date that is 90 days after the date of the enactment of this Act.CommentsClose CommentsPermalink

SEC. 5. DISCLOSURE OF POLITICAL INTELLIGENCE ACTIVITIES UNDER LOBBYING DISCLOSURE ACT.

(a) Definitions- Section 3 of the Lobbying Disclosure Act of 1995 (2 U.S.C. 1602) is amended--CommentsClose CommentsPermalink





(1) in paragraph (2)--CommentsClose CommentsPermalink





(A) by inserting after ‘lobbying activities’ each place that term appears the following: ‘or political intelligence activities’; andCommentsClose CommentsPermalink





(B) by inserting after ‘lobbyists’ the following: ‘or political intelligence consultants’; andCommentsClose CommentsPermalink





(2) by adding at the end the following new paragraphs:CommentsClose CommentsPermalink





‘(17) POLITICAL INTELLIGENCE ACTIVITIES- The term ‘political intelligence activities’ means political intelligence contacts and efforts in support of such contacts, including preparation and planning activities, research, and other background work that is intended, at the time it is performed, for use in contacts, and coordination with such contacts and efforts of others.CommentsClose CommentsPermalink





‘(18) POLITICAL INTELLIGENCE CONTACT-CommentsClose CommentsPermalink





‘(A) DEFINITION- The term ‘political intelligence contact’ means any oral or written communication (including an electronic communication) to or from a covered executive branch official or a covered legislative branch official, the information derived from which is intended for use in analyzing securities or commodities markets, or in informing investment decisions, and which is made on behalf of a client with regard to--CommentsClose CommentsPermalink





‘(i) the formulation, modification, or adoption of Federal legislation (including legislative proposals);CommentsClose CommentsPermalink





‘(ii) the formulation, modification, or adoption of a Federal rule, regulation, Executive order, or any other program, policy, or position of the United States Government; orCommentsClose CommentsPermalink





‘(iii) the administration or execution of a Federal program or policy (including the negotiation, award, or administration of a Federal contract, grant, loan, permit, or license).CommentsClose CommentsPermalink





‘(B) EXCEPTION- The term ‘political intelligence contact’ does not include a communication that is made by or to a representative of the media if the purpose of the communication is gathering and disseminating news and information to the public.CommentsClose CommentsPermalink





‘(19) POLITICAL INTELLIGENCE FIRM- The term ‘political intelligence firm’ means a person or entity that has 1 or more employees who are political intelligence consultants to a client other than that person or entity.CommentsClose CommentsPermalink





‘(20) POLITICAL INTELLIGENCE CONSULTANT- The term ‘political intelligence consultant’ means any individual who is employed or retained by a client for financial or other compensation for services that include one or more political intelligence contacts.’.CommentsClose CommentsPermalink





(b) Registration Requirement- Section 4 of the Lobbying Disclosure Act of 1995 (2 U.S.C. 1603) is amended--CommentsClose CommentsPermalink





(1) in subsection (a)--CommentsClose CommentsPermalink





(A) in paragraph (1)--CommentsClose CommentsPermalink





(i) by inserting after ‘whichever is earlier,’ the following: ‘or a political intelligence consultant first makes a political intelligence contact,’; andCommentsClose CommentsPermalink





(ii) by inserting after ‘such lobbyist’ each place that term appears the following: ‘or consultant’;CommentsClose CommentsPermalink





(B) in paragraph (2), by inserting after ‘lobbyists’ each place that term appears the following: ‘or political intelligence consultants’; andCommentsClose CommentsPermalink





(C) in paragraph (3)(A)--CommentsClose CommentsPermalink





(i) by inserting after ‘lobbying activities’ each place that term appears the following: ‘and political intelligence activities’; andCommentsClose CommentsPermalink





(ii) in clause (i), by inserting after ‘lobbying firm’ the following: ‘or political intelligence firm’;CommentsClose CommentsPermalink





(2) in subsection (b)--CommentsClose CommentsPermalink





(A) in paragraph (3), by inserting after ‘lobbying activities’ each place that term appears the following: ‘or political intelligence activities’;CommentsClose CommentsPermalink





(B) in paragraph (4)--CommentsClose CommentsPermalink





(i) in the matter preceding subparagraph (A), by inserting after ‘lobbying activities’ the following: ‘or political intelligence activities’; andCommentsClose CommentsPermalink





(ii) in subparagraph (C), by inserting after ‘lobbying activity’ the following: ‘or political intelligence activity’;CommentsClose CommentsPermalink





(C) in paragraph (5), by inserting after ‘lobbying activities’ each place that term appears the following: ‘or political intelligence activities’;CommentsClose CommentsPermalink





(D) in paragraph (6), by inserting after ‘lobbyist’ each place that term appears the following: ‘or political intelligence consultant’; andCommentsClose CommentsPermalink





(E) in the matter following paragraph (6), by inserting ‘or political intelligence activities’ after ‘such lobbying activities’;CommentsClose CommentsPermalink





(3) in subsection (c)--CommentsClose CommentsPermalink





(A) in paragraph (1), by inserting after ‘lobbying contacts’ the following: ‘or political intelligence contacts’; andCommentsClose CommentsPermalink





(B) in paragraph (2)--CommentsClose CommentsPermalink





(i) by inserting after ‘lobbying contact’ the following: ‘or political intelligence contact’; andCommentsClose CommentsPermalink





(ii) by inserting after ‘lobbying contacts’ the following: ‘and political intelligence contacts’; andCommentsClose CommentsPermalink





(4) in subsection (d), by inserting after ‘lobbying activities’ each place that term appears the following: ‘or political intelligence activities’.CommentsClose CommentsPermalink





(c) Reports by Registered Political Intelligence Consultants- Section 5 of the Lobbying Disclosure Act of 1995 (2 U.S.C. 1604) is amended--CommentsClose CommentsPermalink





(1) in subsection (a), by inserting after ‘lobbying activities’ the following: ‘and political intelligence activities’;CommentsClose CommentsPermalink





(2) in subsection (b)--CommentsClose CommentsPermalink





(A) in paragraph (2)--CommentsClose CommentsPermalink





(i) in the matter preceding subparagraph (A), by inserting after ‘lobbying activities’ the following: ‘or political intelligence activities’;CommentsClose CommentsPermalink





(ii) in subparagraph (A)--CommentsClose CommentsPermalink





(I) by inserting after ‘lobbyist’ the following: ‘or political intelligence consultant’; andCommentsClose CommentsPermalink





(II) by inserting after ‘lobbying activities’ the following: ‘or political intelligence activities’;CommentsClose CommentsPermalink





(iii) in subparagraph (B), by inserting after ‘lobbyists’ the following: ‘and political intelligence consultants’; andCommentsClose CommentsPermalink





(iv) in subparagraph (C), by inserting after ‘lobbyists’ the following: ‘or political intelligence consultants’;CommentsClose CommentsPermalink





(B) in paragraph (3)--CommentsClose CommentsPermalink





(i) by inserting after ‘lobbying firm’ the following: ‘or political intelligence firm’; andCommentsClose CommentsPermalink





(ii) by inserting after ‘lobbying activities’ each place that term appears the following: ‘or political intelligence activities’; andCommentsClose CommentsPermalink





(C) in paragraph (4), by inserting after ‘lobbying activities’ each place that term appears the following: ‘or political intelligence activities’; andCommentsClose CommentsPermalink





(3) in subsection (d)(1), in the matter preceding subparagraph (A), by inserting ‘or a political intelligence consultant’ after ‘a lobbyist’.CommentsClose CommentsPermalink





(d) Disclosure and Enforcement- Section 6(a) of the Lobbying Disclosure Act of 1995 (2 U.S.C. 1605) is amended--CommentsClose CommentsPermalink





(1) in paragraph (3)(A), by inserting after ‘lobbying firms’ the following: ‘, political intelligence consultants, political intelligence firms,’;CommentsClose CommentsPermalink





(2) in paragraph (7), by striking ‘or lobbying firm’ and inserting ‘lobbying firm, political intelligence consultant, or political intelligence firm’; andCommentsClose CommentsPermalink





(3) in paragraph (8), by striking ‘or lobbying firm’ and inserting ‘lobbying firm, political intelligence consultant, or political intelligence firm’.CommentsClose CommentsPermalink





(e) Rules of Construction- Section 8(b) of the Lobbying Disclosure Act of 1995 (2 U.S.C. 1607(b)) is amended by striking ‘or lobbying contacts’ and inserting ‘lobbying contacts, political intelligence activities, or political intelligence contacts’.CommentsClose CommentsPermalink





(f) Identification of Clients and Covered Officials- Section 14 of the Lobbying Disclosure Act of 1995 (2 U.S.C. 1609) is amended--CommentsClose CommentsPermalink





(1) in subsection (a)--CommentsClose CommentsPermalink





(A) in the heading, by inserting ‘or Political Intelligence’ after ‘Lobbying’;CommentsClose CommentsPermalink





(B) by inserting ‘or political intelligence contact’ after ‘lobbying contact’ each place that term appears; andCommentsClose CommentsPermalink





(C) in paragraph (2), by inserting ‘or political intelligence activity, as the case may be’ after ‘lobbying activity’;CommentsClose CommentsPermalink





(2) in subsection (b)--CommentsClose CommentsPermalink





(A) in the heading, by inserting ‘or Political Intelligence’ after ‘Lobbying’;CommentsClose CommentsPermalink





(B) by inserting ‘or political intelligence contact’ after ‘lobbying contact’ each place that term appears; andCommentsClose CommentsPermalink





(C) in paragraph (2), by inserting ‘or political intelligence activity, as the case may be’ after ‘lobbying activity’; andCommentsClose CommentsPermalink





(3) in subsection (c), by inserting ‘or political intelligence contact’ after ‘lobbying contact’.CommentsClose CommentsPermalink





(g) Annual Audits and Reports by Comptroller General- Section 26 of the Lobbying Disclosure Act of 1995 (2 U.S.C. 1614) is amended--CommentsClose CommentsPermalink





(1) in subsection (a)--CommentsClose CommentsPermalink





(A) by inserting ‘political intelligence firms, political intelligence consultants,’ after ‘lobbying firms’; andCommentsClose CommentsPermalink





(B) by striking ‘lobbying registrations’ and inserting ‘registrations’;CommentsClose CommentsPermalink





(2) in subsection (b)(1)(A), by inserting ‘political intelligence firms, political intelligence consultants,’ after ‘lobbying firms’; andCommentsClose CommentsPermalink





(3) in subsection (c), by inserting ‘or political intelligence consultant’ after ‘a lobbyist’.CommentsClose CommentsPermalink

SEC. 6. EFFECTIVE DATE.

Subject to section 5(b), this Act and the amendments made by this Act shall take effect at the end of the 90-day period beginning on the date of the enactment of this Act.CommentsClose CommentsPermalink