The STOCK Act legislation combatting insider trading among members of Congress passed nearly unanimously in the Senate Tuesday. But one of two senators who voted against the bill slammed it as a political game.
Sen. Tom Coburn, an Oklahoma Republican, denounced the bill as a gimmick that will fail to restore the American public's faith in Congress, now at historic lows.
The STOCK Act, which passed 93 to 2, was born from a CBS 60 Minutes report on members of Congress who have legally profited from trading stocks using information learned in the course of their official duties.
Though federal lawmakers are already subject to insider trading law, the legislation specifically bans inside trading based on nonpublic information and requires members of Congress to report stock trades and other financial transactions every 30 days.
The assumption that the Senate is undertaking now is that some of our colleagues are doing insider trading on the stock market, nothing could be further from the truth, Coburn said in a floor speech. He said that he wants to fix the real problem. You're treating symptoms.
Coburn Wants to Ban 'Horse Trading'
What gets the American public down on Congress, Coburn said, is the political horse trading that occurs with major legislation, bringing up the infamous Cornhusker Kickback, in which a Nebraska senator got a deal on state Medicaid funding in exchange for his vote on the Affordable Care Act.
That's the real insider trading scandal we ought to be addressing, Coburn said.
If the intent of the bill was to give the U.S. Securities and Exchange Commission clear jurisdiction to sniff out this kind of illegal conduct in Congress, Coburn suggested a bill that states federal lawmakers are covered by the SEC's insider trading laws.
If our intent is to bring forward a bill to fix the potential of insider trading, then that's what we ought to be doing, Coburn said.
The House of Representatives is also working on its own insider trading legislation. House Majority Leader Eric Cantor said Tuesday that the Senate's version does not go far enough. President Barack Obama said at his State of the Union address that he would sign a bill prohibiting insider trading in Congress.