[Congressional Bills 111th Congress]
[From the U.S. Government Publishing Office]
[H.R. 682 Introduced in House (IH)]

111th CONGRESS
  1st Session
                                H. R. 682

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


_______________________________________________________________________


                    IN THE HOUSE OF REPRESENTATIVES

                            January 26, 2009

  Mr. Baird (for himself, Ms. Slaughter, and Mr. Walz) introduced the 
   following bill; which was referred to the Committee on Financial 
 Services, and in addition to the Committees on House Administration, 
 the Judiciary, Agriculture, and Standards of Official Conduct, for a 
 period to be subsequently determined by the Speaker, in each case for 
consideration of such provisions as fall within the jurisdiction of the 
                          committee concerned

_______________________________________________________________________

                                 A BILL


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

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

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Stop Trading on Congressional 
Knowledge Act''.

SEC. 2. NONPUBLIC INFORMATION RELATING TO CONGRESS.

    (a) Securities Transactions.--Section 10 of the Securities Exchange 
Act of 1934 is amended by adding at the end the following:
    ``(c) 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 the securities 
of any issuer while such person is in possession of material nonpublic 
information, as defined by the Commission, relating to any pending or 
prospective legislative action relating to such issuer if--
            ``(1) such information was obtained by reason of such 
        person being a Member or employee of Congress; or
            ``(2) such information was obtained from a Member or 
        employee of Congress, and such person knows that the 
        information was so obtained.
    ``(d) Nonpublic Information Relating to Other Federal Employees.--
            ``(1) Rulemaking.--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 of 
        any issuer while such person is in possession of material 
        nonpublic information derived from Federal employment and 
        relating to such issuer if--
                    ``(A) such information was obtained by reason of 
                such person being an employee of an agency, as such 
                term is defined in section 551(1) of title 5, United 
                States Code; or
                    ``(B) such information was obtained from such an 
                employee, and such person knows that the information 
                was so obtained.
            ``(2) Material nonpublic information.--For purposes of this 
        subsection, the term `material nonpublic information' means any 
        information that an employee of an agency (as such term is 
        defined in section 551(1) of title 5, United States Code) gains 
        by reason of Federal employment and that such employee knows or 
        should know has not been made available to the general public, 
        including information that--
                    ``(A) 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;
                    ``(B) is designated as confidential by an agency; 
                or
                    ``(C) has not actually been disseminated to the 
                general public and is not authorized to be made 
                available to the public on request.''.
    (b) Commodities Transactions.--Section 4c of the Commodities 
Exchange Act (7 U.S.C. 6c) is amended by adding at the end the 
following:
    ``(h) 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 while such person is in possession of material 
nonpublic information, as defined by the Commission, relating to any 
pending or prospective legislative action relating to such commodity 
if--
            ``(1) such information was obtained by reason of such 
        person being a Member or employee of Congress; or
            ``(2) such information was obtained from a Member or 
        employee of Congress, and such person knows that the 
        information was so obtained.
    ``(i) Nonpublic Information Relating to Other Federal Employees.--
            ``(1) Rulemaking.--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 while such person is in possession of material 
        nonpublic information derived from Federal employment and 
        relating to such commodity if--
                    ``(A) such information was obtained by reason of 
                such person being an employee of an agency, as such 
                term is defined in section 551(1) of title 5, United 
                States Code; or
                    ``(B) such information was obtained from such an 
                employee, and such person knows that the information 
                was so obtained.
            ``(2) Material nonpublic information.--For purposes of this 
        subsection, the term `material nonpublic information' means any 
        information that an employee of an agency (as such term is 
        defined in section 551(1) of title 5, United States Code) gains 
        by reason of Federal employment and that such employee knows or 
        should know has not been made available to the general public, 
        including information that--
                    ``(A) 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;
                    ``(B) is designated as confidential by an agency; 
                or
                    ``(C) has not actually been disseminated to the 
                general public and is not authorized to be made 
                available to the public on request.''.

SEC. 3. AMENDMENT TO THE RULES OF THE HOUSE OF REPRESENTATIVES 
              REGARDING SECURITIES TRADING BASED ON NONPUBLIC 
              INFORMATION.

    Rule XXIII (known as the ``Code of Official Conduct'') of the Rules 
of the House of Representatives is amended by redesignating clause 18 
as clause 19 and by inserting after clause 17 the following new clause:
            ``18. A Member, Delegate, Resident Commissioner, officer, 
        or employee of the House shall not--
                    ``(a) disclose material nonpublic information 
                relating to any pending or prospective legislative 
                action relating to any publicly-traded company if that 
                Member, Delegate, Resident Commissioner, officer, or 
                employee has reason to believe that the information 
                will be used to buy or sell the securities of such 
                publicly-traded company based on such information; or
                    ``(b) disclose material nonpublic information 
                relating to any pending or prospective legislative 
                action relating to any commodity if that Member, 
                Delegate, Resident Commissioner, officer, or employee 
                has reason to believe that the information will be used 
                to buy or sell such commodity for future delivery based 
                on such information.''.

SEC. 4. TIMELY REPORTING OF SECURITIES TRANSACTIONS.

    (a) Amendment.--Section 103 of the Ethics in Government Act of 1978 
is amended by adding at the end the following subsection:
    ``(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 $1000 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.''.
    (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.

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--
            (1) in paragraph (2)--
                    (A) by inserting after ``lobbying activities'' each 
                place that term appears the following: ``or political 
                intelligence activities''; and
                    (B) by inserting after ``lobbyists'' the following: 
                ``or political intelligence consultants''; and
            (2) by adding at the end the following new paragraphs:
            ``(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.
            ``(18) Political intelligence contact.--
                    ``(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--
                            ``(i) the formulation, modification, or 
                        adoption of Federal legislation (including 
                        legislative proposals);
                            ``(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; or
                            ``(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).
                    ``(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.
            ``(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.
            ``(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.''.
    (b) Registration Requirement.--Section 4 of the Lobbying Disclosure 
Act of 1995 (2 U.S.C. 1603) is amended--
            (1) in subsection (a)--
                    (A) in paragraph (1)--
                            (i) by inserting after ``whichever is 
                        earlier,'' the following: ``or a political 
                        intelligence consultant first makes a political 
                        intelligence contact,''; and
                            (ii) by inserting after ``such lobbyist'' 
                        each place that term appears the following: 
                        ``or consultant'';
                    (B) in paragraph (2), by inserting after 
                ``lobbyists'' each place that term appears the 
                following: ``or consultants''; and
                    (C) in paragraph (3)(A)--
                            (i) by inserting after ``lobbying 
                        activities'' each place that term appears the 
                        following: ``and political intelligence 
                        activities''; and
                            (ii) in clause (i), by inserting after 
                        ``lobbying firm'' the following: ``or political 
                        intelligence firm'';
            (2) in subsection (b)--
                    (A) in paragraph (3), by inserting after ``lobbying 
                activities'' each place that term appears the 
                following: ``or political intelligence activities'';
                    (B) in paragraph (4)--
                            (i) in the matter preceding subparagraph 
                        (A), by inserting after ``lobbying activities'' 
                        the following: ``or political intelligence 
                        activities''; and
                            (ii) in subparagraph (C), by inserting 
                        after ``lobbying activity'' the following: ``or 
                        political intelligence activity'';
                    (C) in paragraph (5), by inserting after ``lobbying 
                activities'' each place that term appears the 
                following: ``or political intelligence activities'';
                    (D) in paragraph (6), by inserting after 
                ``lobbyist'' each place that term appears the 
                following: ``or political intelligence consultant''; 
                and
                    (E) in the matter following paragraph (6), by 
                inserting ``or political intelligence activities'' 
                after ``such lobbying activities'';
            (3) in subsection (c)--
                    (A) in paragraph (1), by inserting after ``lobbying 
                contacts'' the following: ``or political intelligence 
                contacts''; and
                    (B) in paragraph (2)--
                            (i) by inserting after ``lobbying contact'' 
                        the following: ``or political intelligence 
                        contact''; and
                            (ii) by inserting after ``lobbying 
                        contacts'' the following: ``and political 
                        intelligence contacts''; and
            (4) in subsection (d), by inserting after ``lobbying 
        activities'' each place that term appears the following: ``or 
        political intelligence activities''.
    (c) Reports by Registered Political Intelligence Consultants.--
Section 5 of the Lobbying Disclosure Act of 1995 (2 U.S.C. 1604) is 
amended--
            (1) in subsection (a), by inserting after ``lobbying 
        activities'' the following: ``and political intelligence 
        activities'';
            (2) in subsection (b)--
                    (A) in paragraph (2)--
                            (i) in the matter preceding subparagraph 
                        (A), by inserting after ``lobbying activities'' 
                        the following: ``or political intelligence 
                        activities'';
                            (ii) in subparagraph (A)--
                                    (I) by inserting after ``lobbyist'' 
                                the following: ``or political 
                                intelligence consultant''; and
                                    (II) by inserting after ``lobbying 
                                activities'' the following: ``or 
                                political intelligence activities'';
                            (iii) in subparagraph (B), by inserting 
                        after ``lobbyists'' the following: ``or 
                        political intelligence consultants''; and
                            (iv) in subparagraph (C), by inserting 
                        after ``lobbyists'' the following: ``or 
                        political intelligence consultants'';
                    (B) in paragraph (3)--
                            (i) by inserting after ``lobbying firm'' 
                        the following: ``or political intelligence 
                        firm''; and
                            (ii) by inserting after ``lobbying 
                        activities'' each place that term appears the 
                        following: ``or political intelligence 
                        activities''; and
                    (C) in paragraph (4), by inserting after ``lobbying 
                activities'' each place that term appears the 
                following: ``or political intelligence activities''; 
                and
            (3) in subsection (d)(1), in the matter preceding 
        subparagraph (A), by inserting ``or a political intelligence 
        consultant'' after ``a lobbyist''.
    (d) Disclosure and Enforcement.--Section 6(a) of the Lobbying 
Disclosure Act of 1995 (2 U.S.C. 1605) is amended--
            (1) in paragraph (3)(A), by inserting after ``lobbying 
        firms'' the following: ``, political intelligence consultants, 
        political intelligence firms,'';
            (2) in paragraph (7), by striking ``or lobbying firm'' and 
        inserting ``lobbying firm, political intelligence consultant, 
        or political intelligence firm''; and
            (3) in paragraph (8), by striking ``or lobbying firm'' and 
        inserting ``lobbying firm, political intelligence consultant, 
        or political intelligence firm''.
    (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''.
    (f) Identification of Clients and Covered Officials.--Section 14 of 
the Lobbying Disclosure Act of 1995 (2 U.S.C. 1609) is amended--
            (1) in subsection (a)--
                    (A) in the heading, by inserting ``or Political 
                Intelligence'' after ``Lobbying'';
                    (B) by inserting ``or political intelligence 
                contact'' after ``lobbying contact'' each place that 
                term appears; and
                    (C) in paragraph (2), by inserting ``or political 
                intelligence activity, as the case may be'' after 
                ``lobbying activity'';
            (2) in subsection (b)--
                    (A) in the heading, by inserting ``or Political 
                Intelligence'' after ``Lobbying'';
                    (B) by inserting ``or political intelligence 
                contact'' after ``lobbying contact'' each place that 
                term appears; and
                    (C) in paragraph (2), by inserting ``or political 
                intelligence activity, as the case may be'' after 
                ``lobbying activity''; and
            (3) in subsection (c), by inserting ``or political 
        intelligence contact'' after ``lobbying contact''.
    (g) Annual Audits and Reports by Comptroller General.--Section 26 
of the Lobbying Disclosure Act of 1995 (2 U.S.C. 1614) is amended--
            (1) in subsection (a), by inserting ``political 
        intelligence firms, political intelligence consultants,'' after 
        ``lobbying firms'';
            (2) in subsection (b)(1)(A), by inserting ``political 
        intelligence firms, political intelligence consultants,'' after 
        ``lobbying firms''; and
            (3) in subsection (c), by inserting ``or political 
        intelligence consultant'' after ``a lobbyist''.

SEC. 6. EFFECTIVE DATE.

    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.
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