[Congressional Record Volume 158, Number 22 (Thursday, February 9, 2012)]
[Senate]
[Pages S486-S487]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
STOCK ACT AMENDMENT
Mr. GRASSLEY. Mr. President, 1 week ago we passed a very important
good government bill, the one that would make sure Members of Congress
cannot benefit from insider trading information. I added to that an
amendment that I think is a good government amendment. It calls for
people who are involved in political intelligence gathering--we don't
hear much about that profession, but it is quite a business. I asked
that they be registered just like lobbyists are registered, and I would
like to speak to the point of why that is very important and why it is
important to bring it to the Senate's attention, even though it passed
by a vote of 60 to 39 just a few days ago.
In the dark of night on Tuesday of this week, the House released its
version of the insider trading bill that goes by the acronym STOCK,
which wiped out any chance of meaningful transparency for the political
intelligence industry. Think about the chutzpah of the people in the
House of Representatives--a small group of people--taking out the
language I put in that bill when similar language is cosponsored by 288
Members of the House of Representatives, but it happened. So that bill
is coming back without the Grassley amendment on it, and we need to
think about what we are going to do if we believe in good government,
and if we believe there ought to be more transparency in government.
What we are faced with is a powerful industry that works in the
shadows--
[[Page S487]]
economic espionage. They don't want people to know what they do or whom
they work for. They are basically afraid of sunlight, I would guess. My
amendment was adopted in the Senate on a very bipartisan basis, kind of
a rare occurrence today. It simply requires registration for lobbyists
who seek information from Congress in order to trade on that
information.
So isn't it very straightforward if trades are taking place based
upon ``political intelligence''--that is their word, ``economic
espionage'' is my word--obtained from Congress or the executive branch,
people in this country should know who is gathering such information.
Not requiring political intelligence professionals to register and
disclose their contacts with government officials is a very gaping
loophole that my amendment fixes. In fact, political intelligence firms
actually brag about this loophole, and I will give an example about
that bragging. This is on the Web site of an organization called the
Open Source Intelligence Group, a political intelligence firm:
Our political intelligence operation differs from standard
`lobbying' in that the OSINT Group is not looking to
influence legislation on behalf of clients, but rather
provide unique `monitoring' of information through our
personal relationships between lawmakers, staffers, and
lobbyists.
Providing this service for clients who do not want their
interest in an issue publicly known is an activity that does
not need to be reported under the Lobbying Disclosure Act,
thus providing an additional layer of confidentially for our
clients.
This service is ideal for companies seeking competitive
advantage by allowing a client's interest to remain
confidential . . .
Think about the words ``personal relationships,''
``confidentiality.'' Basically, what they are saying is do all this
under the radar.
I wish to go back, if you didn't hear it the first time, let me
repeat some of this for you, a much shorter quote:
Providing this service for clients who do not want their
interests in an issue publicly known is an activity that does
not need to be reported under the Lobbying Disclosure Act,
thus providing an additional layer of confidentiality for our
clients.
We have it here on paper, and I just read it to you. This firm--
probably one of many firms; I don't know how many firms are doing
this--is telling potential clients: If you don't want anybody to know
what you are asking of Federal officials, hire us. That is wrong, but
that is why firms such as this don't want to register. If someone on
Wall Street is trying to make money off conversations they had with
Senators or staff, we should know who they are. It is that plain and
simple.
Since the passage of my amendment, which would require political
intelligence lobbyists to register as lobbyists, I have heard a great
deal of ``concern'' from the lobbying community. Political intelligence
professionals have claimed they should do their business in secret for
several reasons.
Now, this is the explanation of why they need secrecy. First, they
have said if they are required to register, they will no longer be able
to sell information to their clients because people will not want to
hire them. That makes me wonder, what do they have to hide?
Second, they have said many of them have large numbers of clients,
and it would take them a lot of time to register these large numbers of
secret clients. Again, that makes me think we actually need more
transparency to find out who are all of these people buying
intelligence information.
Third, they have claimed it would not address the so-called ``20-
percent loophole'' that allows people who spend less than 20 percent of
their time lobbying from having to register under existing laws as
lobbyists. Not too many people know of that 20-percent loophole, but
that is a pretty big loophole. A person can lobby, but they don't have
to register if they don't spend more than 20 percent of their time on
it. Well, on this issue I have some good news for these people. We
don't make the mistake that caused the 20-percent loophole. My
amendment requires anyone who makes a political intelligence contact to
have to register. No loopholes, no deals, no special treatment, just
everyone registers.
Finally, I just want to assure people, particularly journalists, that
they would not have to register. Now, that information has been
floating around, and it has been floating around that some constituents
looking for information in order to make a business decision might have
to register. Not so. Only political intelligence brokers, people who
seek information so others can trade securities, would have to
register.
As I said before, if people want to trade stocks from what we do in
Congress, we should know who they are. After all, the basic underlying
piece of legislation prohibits Members of Congress from having insider
trading information and profiting from it. We ought to know with whom
we are dealing. The American people deserve a little sunshine from this
industry and on this industry.
Last night, the House turned away from transparency. They supported
the status quo. What we need is a full and open conference process so
we can take up this very important issue once again that the House
believes was somehow not very important, even though 288 Members of the
House of Representatives--that is two-thirds of the House of
Representatives--have signed on to this principle that these people
ought to register. We can take that up then in conference, both the
House and Senate, working together.
Is every word in this bill the way it ought to be? If somebody wants
to point out some things that ought to be changed, I am open to that.
But don't forget, 288 people in the House have signed on. It can't be
too bad.
So if we don't get to conference or if we have to debate this again
on the floor of the Senate, we might not get 60 votes again. So I worry
we will miss the best opportunity we have had for openness and
transparency in years.
I yield the floor.
The PRESIDING OFFICER. The Senator from Oregon.
Mr. WYDEN. I thank the Chair.
(The remarks of Mr. Wyden pertaining to the introduction of S. 2098
are printed in today's Record under ``Statements on Introduced Bills
and Joint Resolutions.'')
Mr. WYDEN. Mr. President, I yield the floor.
The PRESIDING OFFICER (Mr. Franken). The Senator from Minnesota.
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