House Approves Ban on Lawmakers Trading on Insider Information

The House of Representatives approved the Stop Insider Trading Act on a 232-198 vote Wednesday, barring members of Congress, their spouses and dependent children from buying or selling publicly listed stocks based on nonpublic information. The measure has been sent to the Senate for consideration.

The bill, introduced by Representative Bryan Steil of Wisconsin, prevents covered lawmakers and family members from trading publicly traded securities when acting on insider information. It sets penalties of $2,000 or 10% of the transaction, requires forfeiture of any profits and mandates disgorgement of gains from prohibited trades.

The legislation requires members to provide seven days’ notice before selling stocks they already own. Steil described that requirement on the House floor as a deterrent to trading on privileged information and said the bill ‘ensures no lawmaker can profit off of insider information’ while it ‘institutes strict penalties for any violation.’

Some Democrats argued the bill does not go far enough because it allows members to retain and later sell existing holdings. Senator Elizabeth Warren criticized the measure Thursday, calling it inadequate and asserting that ‘members of Congress should not own, buy, or sell stocks.’

The Stop Insider Trading Act does not apply to the president, the vice president or their families. A separate Senate proposal, the Digital Asset Market Clarity Act, would extend certain restrictions to a broader set of public officials and some digital assets, including limits on issuing or sponsoring tokens through 2029 in the draft text.

The House vote follows related proposals by Steil aimed at barring some officials and their family members from wagering on prediction markets. That effort includes similar penalties and attracted attention after reports that a service member allegedly won more than $400,000 betting on the removal of Venezuela’s president and that a White House staffer reportedly earned more than $100,000 on event contracts tied to presidential speech content.

With passage in the House complete, the Stop Insider Trading Act now awaits action in the Senate. Lawmakers in both chambers are expected to debate the scope of trading restrictions, enforcement measures and whether prohibitions should cover additional public officials.