December 01, 2011

Senator Gillibrand Testimony on “Insider Trading and Congressional Accountability”

Washington, DC – U.S. Senator Kirsten Gillibrand released the following testimony for the U.S. Senate Committee on Homeland Security and Governmental Affairs Hearing on “Insider Trading and Congressional Accountability:”

WATCH Senator Gillibrand’s full testimony here 

“Thank you, Chairman Lieberman, and Ranking Member Collins, for holding this important hearing, and for inviting me to offer testimony this afternoon. Your strong leadership today in shining a light on this issue of fundamental fairness is a step forward on the path to restoring American’s faith in their government.  

“Like millions of American’s all across the country, I was surprised to learn that insider trading by members of Congress, their families, or their staff, using non-public information gained through their Congressional work is not clearly and expressly prohibited by law and the rules of Congress. 

“The American people need to know that their elected leaders play by the exact same rules that they play by. They also deserve the right to know their lawmakers' only interest is what's best for the country, not their own financial interests. 

“Members of Congress, their families and staff shouldn’t be able to gain personal profits from information they have access to that everyday middle class families don’t. It's simply not right -- nobody should be above the rules. 

“I have introduced a bipartisan bill in the Senate with fifteen of our colleagues -- Senators Rubio, Snowe, Johanns, Tester, Stabenow, McCaskill, Klobuchar, Durbin, Blumenthal, Bill Nelson, Reed, Cardin, Kerry, Sherrod Brown, and Baucus -- to close this loophole. 

“This STOCK Act legislation is very similar to the legislation introduced by my friends in the House of Representatives, Louise Slaughter and Tim Walz. I want to thank them for their longstanding and dedicated leadership. I also want to recognize Senator Scott Brown for requesting today’s hearing and his work on this issue.  

“Our bill, which has received the support of at least seven good government advocacy groups, covers several important principles:

 

  • Members of Congress, their families and their staff should be barred from buying or selling securities on the basis of knowledge gained through their Congressional service – or from using that knowledge to tip off anyone else. The SEC and CFTC must be empowered to investigate these cases. To provide additional teeth -- such acts should also be a violation of Congress’s own rules, to make clear that this activity is inappropriate. 

 

  • Members should be required to disclose major transactions – of $1,000 or more – within 90 days, providing dramatically improved oversight and accountability from the current annual reporting requirements. 

 

  • Lastly, individuals doing political intelligence work – contacting members of Congress, their staffs, and other individuals to gain information on investment decisions – should have to register as lobbyists to provide oversight of this industry.  

“There are those who don’t want us to succeed and pass this common sense legislation the American people expect. Some critics will say this bill is unnecessary and already covered under current statutes. I have spoken with experts tasked in the past with investigations of this nature who strongly disagree. We must make it unambiguous that this kind of behavior is illegal. 

“Others may say this bill will be too weak. Let me be clear – our mission is to pass a strong bill with teeth that will make any and all insider trading clearly illegal and a violation of Congressional rules for all members of Congress, their families and their staff. As we move forward, there will be technical changes in the language to improve the bill and ensure the final product meets this goal. Anything less is unacceptable.     

“As my home state newspaper the Buffalo News recently noted, “… the STOCK Act would ensure that it’s the people’s business being attended to.” This is a step we must take to begin restoring trust to this broken Congress. 

“Thank you again, Senator Lieberman and Senator Collins, for inviting me today to share my testimony on this important issue.”