[Congressional Record Volume 165, Number 194 (Thursday, December 5, 2019)]
[House]
[Pages H9271-H9279]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                    INSIDER TRADING PROHIBITION ACT


                             General Leave

  Ms. WATERS. Mr. Speaker, I ask unanimous consent that all Members may 
have 5 legislative days within which to revise and extend their remarks 
on H.R. 2534 and to insert extraneous material thereon.
  The SPEAKER pro tempore (Mr. Raskin). Is there objection to the 
request of the gentlewoman from California?
  There was no objection.
  The SPEAKER pro tempore. Pursuant to House Resolution 739 and rule 
XVIII, the Chair declares the House in the Committee of the Whole House 
on the state of the Union for the consideration of the bill, H.R. 2534.
  The Chair appoints the gentlewoman from Alabama (Ms. Sewell) to 
preside over the Committee of the Whole.

                              {time}  1321


                     In the Committee of the Whole

  Accordingly, the House resolved itself into the Committee of the 
Whole House on the state of the Union for the consideration of the bill 
(H.R. 2534) to amend the Securities Exchange Act of 1934 to prohibit 
certain securities trading and related communications by those who 
possess material, nonpublic information, with Ms. Sewell of Alabama in 
the chair.
  The Clerk read the title of the bill.
  The CHAIR. Pursuant to the rule, the bill is considered read the 
first time.
  General debate shall be confined to the bill and shall not exceed 1 
hour equally divided and controlled by the chair and ranking minority 
member of the Committee on Financial Services.
  The gentlewoman from California (Ms. Waters) and the gentleman from 
Michigan (Mr. Huizenga) each will control 30 minutes.
  The Chair recognizes the gentlewoman from California.
  Ms. WATERS. Madam Chairwoman, I yield myself such time as I may 
consume.
  Madam Chairwoman, I rise in strong support of H.R. 2534, the Insider 
Trading Prohibition Act, introduced by the gentleman from Connecticut, 
Representative  Jim Himes.
  This long overdue bill creates a clear definition of illegal insider 
trading under the securities laws so that there is a codified, 
consistent standard for courts and market participants to better 
protect the hard-earned savings of millions of Americans and bring 
certainty to the U.S. securities market.
  For nearly 80 years, the Securities and Exchange Commission--that is, 
the SEC--has sought to hold corporate insiders accountable for insider 
trading through general statutory antifraud provisions and rules it has 
promulgated under those provisions. This has resulted in a web of court 
decisions that generally prohibit insiders with a duty of trust and 
confidence to a corporation from secretly trading on material, 
nonpublic corporate information for their own personal gain.
  These insiders are also generally prohibited from tipping outsiders, 
known as tippees, who then trade on the information themselves, even 
though they know it was wrongfully obtained.
  But, because there isn't a statutory definition of ``insider 
trading,'' there is uncertainty around who is subject to insider 
trading prohibitions; and, with various court decisions, liability for 
this type of violation has shifted.
  For example, in 2014, an appeals court added a brand-new requirement 
that the tippee must not just know that information was wrongfully 
disclosed but must also know about the specific personal benefit that 
the insider received.
  This decision has severely hampered the SEC's ability to prosecute 
insider trading cases and, according to Preet Bharara, the former U.S. 
attorney for the Southern District of New York ``provides a virtual 
roadmap for savvy hedge fund managers to insulate themselves from 
tippee liability by knowingly placing themselves at the end of a chain 
of insider information and avoiding learning details about the sources 
of obvious confidential and improperly disclosed information.''

[[Page H9272]]

  So I am pleased that this bill codifies existing case law and 
overturns this new controversial requirement, creating a clear, 
consistent standard for the SEC, the courts, and market participants to 
follow, and does so in a way that, as Columbia Law School professor 
John Coffee testified before one of our subcommittees, ``expands 
liability in ways that should not be controversial.''
  I would like to commend Representative Himes for his efforts since 
the bill was marked up in May in committee to ensure that it fairly 
reflects existing law. In addition to extensive outreach to current and 
former regulators and prosecutors, investor advocates, and 
institutional investors, Mr. Himes also repeatedly engaged with our 
colleagues on the opposite side of the aisle.

  As a result, Ranking Member McHenry will offer an amendment which 
will remove unnecessary ambiguities, clarify the intent of the bill to 
reflect existing insider trading case law, and ensure that the bill 
preserves the SEC's ability to bring bad actors to justice under other 
related insider trading laws.
  I plan to support this amendment as a reasonable bipartisan 
compromise, so I urge all Members to support this commonsense bill that 
makes the definition of illegal trading very clear for all so that the 
SEC can effectively crack down on corporate insiders who illegally 
trade on inside information.
  Madam Chair, I reserve the balance of my time.
  Mr. HUIZENGA. Madam Chair, I yield myself such time as I may consume.
  Madam Chair, preventing fraud and abuse within our financial system 
and cracking down on bad actors for illegal insider trading is a 
nonpartisan priority. This kind of fraud and illegal activity hurts 
everyday investors, and it also makes our markets less efficient, 
accurate, and reliable.
  Current law prohibits trading on material insider information in 
breach of a fiduciary duty under the antifraud provisions of the 
Federal securities law.
  The Securities and Exchange Commission and the Department of Justice 
are the Federal agencies tasked with enforcing insider trading. Both 
agencies regularly use their authority by bringing insider trading 
cases against bad actors who violate our insider trading laws.
  The SEC has not asked for this bill, however, unlike other bills that 
Republicans have voted for out of this House in the past month. 
Moreover, Democrats have not fully identified a problem within the 
current body of the law that inhibits the prosecution of bad actors who 
illegally trade on material, nonpublic information.
  As it is written before us on the floor at this moment, this bill 
could potentially create more confusion and uncertainty within the law 
of insider trading. It could even expand liability for good faith 
traders, which would hurt the efficiencies of our markets, chill vital 
information gathering, and weaken investor confidence.
  Republican and Democrat SEC chairs alike, with vastly different 
approaches to enforcement matters, have expressed concern over Congress 
codifying a prohibition on insider trading into one single statute. 
Specifically, they voiced concerns that Congress would write a law that 
could be both overly broad and too narrow at the same time.
  I share their concerns with the bill as drafted before us today, and 
I am pleased to hear that the chair has indicated that the majority 
will be accepting the ranking member's amendment shortly.
  I am concerned that the current version of the bill, however, does 
not include an explicit personal benefit test, as set forth by the 
Supreme Court precedents. I am troubled that an unclear phrasing such 
as ``relating to the market'' is overbroad and will allow judges and 
prosecutors to expand the law.
  I am also concerned that the bill, as drafted, lacks an exclusivity 
provision that would make this bill the exclusive law of the land.
  Finally, the rule of construction section before us is troubling, 
because the Financial Services Committee has not even had a chance to 
debate this specific language. I fear that this language could add more 
confusion and uncertainty around insider trading laws, with rogue 
judges and prosecutors using the language to expand the bounds of 
insider trading law.
  I do believe that the ranking member's amendment goes a distance in 
clarifying that, but, as I will talk about, I will be having an 
amendment later on as well that I believe further clarifies that.

                              {time}  1330

  Drafting a statute that appropriately and accurately captures the 
subtleties of insider trading case law and regulations that have been 
shaped and finessed over decades into one single statute isn't easy, to 
say the least.
  Achieving bipartisan support also isn't easy, especially when it 
involves nuanced and technical substance such as the body of insider 
trading law.
  My colleague, Ranking Member McHenry, will be offering his amendment 
momentarily that represents a bipartisan agreement with the author to 
improve the bill by including some Republican priorities and improving 
the bill to better track current insider trading law.
  As I had mentioned, I will be offering an amendment as well in an 
attempt to further clarify and improve this proposal.
  So, while we are unsure exactly what the final product is going to 
look like here, I do want to commend both Mr. Himes and Ranking Member 
McHenry for working together to attempt to reach a bipartisan agreement 
to improve this bill with the amendment and to make it clear that it is 
Congress' intent to codify existing law without broadening it into new 
areas. I hope that the author of the legislation will accept my 
amendment as well.
  Madam Chair, I reserve the balance of my time.
  Ms. WATERS. Madam Chair, I yield such time as he may consume to the 
gentleman from Connecticut (Mr. Himes), the chair of the Strategic 
Technologies and Advanced Research Subcommittee of the Permanent Select 
Committee on Intelligence, and a valued member of the Financial 
Services Committee.
  Mr. HIMES. Madam Chair, I thank the gentlewoman for yielding.
  I rise, delighted today by our consideration of H.R. 2534, the 
Insider Trading Prohibition Act, because, after years of work, we are 
going to produce a bipartisan product which actually does address a 
significant challenge in insider trading law, and that is, in general, 
that, to date, there has existed, remarkably, no specific statutory 
prohibition on insider trading.
  I am a believer, as I know everyone else in this Chamber is, that, if 
we are going to create criminal or civil liability, the legislators of 
the Congress of the United States should make specific how and when and 
under what circumstances we do so. And that is what we are doing today, 
I am delighted to report, in bipartisan fashion.
  But let me back up for a second, for those who don't sit on the 
committee or watch this particular space all that closely, just to 
explain why this is important.
  Insider trading is an activity in which somebody who has information 
that they have been entrusted with, or for which they have paid or come 
by in some dishonest fashion, uses it to secure a market advantage. 
They have information that others don't. They trade on that 
information. That allows them to get a material gain.
  There is a problem with that, quite apart from the notion that it is 
only insiders or those people who are not acting based on their talent 
or their intelligence or their hard work, but acting based on who they 
know or, worse yet, who they might have paid, that they are the ones 
who benefit from our capital markets. I think that notion sort of 
strikes at the fundamental sense of fairness that we all carry around.
  But, inasmuch as this behavior exists, it is profoundly damaging to 
the capital markets that are such a hallmark of the United States, and 
it is damaging because those capital markets rely on the confidence 
that millions of American families have out there that their hard-
earned savings can be put into the market, invested, and redeployed in 
a way that is fair to them, that will create a return, and that they 
are doing so on a level playing field, not competing with people who 
may have an inside advantage.

[[Page H9273]]

  Now, the good news here is that, in the generations preceding us, we 
have, in fact, prosecuted insider trading, but we have done so under 
antifraud provisions of the Securities Acts that were passed in the 
early 1930s; and, as a result, there is not a particularly good fit 
between the concept of fraud and the concept of insider trading.
  And to my friend Mr. Huizenga's point, as he knows, this has led to a 
vast body of court-determined law, starting with the Dirks decision in 
1984, moving through Materia, Carpenter, O'Hagan, all court decisions 
which crafted the concept of liability around insider trading, 
culminating in the 2014 Newman decision by the Second Circuit, leading 
then to the Salman decision at the Supreme Court in 2016.
  All of these cases that I have mentioned have created uncertainty 
about the nature of liability and have resulted in overturned 
convictions of people who behaved in ways that would violate our 
intuitive sense of right and wrong.
  So, because of this uncertainty, because of the overturning of 
convictions, now is the moment for us to finally do what we are here to 
do, which is to make it very clear what the law of the land is.
  So the moment has come to pass this legislation, and I am delighted 
to say it comes after years of working with experts like the 
aforementioned Professor John Coffee, past and present Commissioners of 
the Securities and Exchange Commission, and consultation with 
prosecutors as well as with defense attorneys.
  This is a fairly fiddly and technical area of the law, and so it was 
my intention, over the years, to make sure that we crafted good law 
which created liability for bad behavior but which did not, in fact, 
create liability for behavior like doing a little extra work to secure 
an advantage in investments.
  It was also very, very important to me that this be done on a 
bipartisan basis. There is really nothing partisan about this bill. 
Neither party believes in insider trading or wants to support insider 
trading. This is not a question of balancing regulation or allocating 
public resources; this is a question of clarity of law.
  So I want to close, apart from just saying that that has been the 
track record of the establishment and writing of this legislation, by 
thanking Ranking Member McHenry and Ranking Member Huizenga.

  There will be an amendment offered by Ranking Member McHenry which 
the Democrats support. It does improve the bill. It is not really a 
compromise in the sense that it actually makes for a better bill.
  But I am pleased to say that, after a lot of hard work, this is, in 
fact, the product of some very robust engagement between the Democratic 
and Republican Representatives in this Chamber. That is not easy to 
achieve under these circumstances.
  So I want to start, first and foremost, by thanking Chairwoman Waters 
and Chairwoman Maloney for their sponsorship and then, again, Mr. 
McHenry and Mr. Huizenga, who committed to really understanding what is 
a technical corner of the law and offered, in good faith, amendments, 
including some ideas that we will shortly be taking up.
  And then, finally, as every Member in this Chamber knows, hard work 
happens and gets done and leads to success only because of the 
commitment and very, very hard work of the staff on both sides of the 
aisle. So, before yielding back my time to the chairwoman, I do want to 
specifically thank Katelynn Bradley, Ben Harney, David Fernandez, and 
David Karp from the Financial Services staff; Mark Snyder, my 
legislative director, and Rachel Kelly, his predecessor, from my staff.
  And then, on the Republican side, big thanks to Kimberly Betz, McArn 
Bennett, and Jamie McGinnis.
  Madam Chair, I urge passage of this law. This will be a good thing 
for the confidence in our capital markets. It will be a good thing in 
reassuring the American public that we can get things done on a 
bipartisan basis. On that basis, I urge passage of H.R. 2534, the 
Insider Trading Prohibition Act.
  Mr. HUIZENGA. Madam Chair, I yield such time as he may consume to the 
gentleman from Wisconsin (Mr. Steil), the newest member of the Investor 
Protection, Entrepreneurship, and Capital Markets Subcommittee.
  Mr. STEIL. Madam Chair, I thank my colleague from Michigan. Our 
districts touch in the middle of Lake Michigan, so I have never been to 
that part of my district, and maybe the gentleman has not either, but I 
appreciate him yielding.
  I rise today to urge support of the Insider Trading Prohibition Act.
  I want to thank Chairwoman Waters, Ranking Member McHenry, as well as 
Mr. Huizenga and Mr. Himes for their work on this important piece of 
legislation.
  As we have seen far too often in this Congress, partisanship and 
poison pills can get in the way of progress and good ideas. I think all 
of us, at our core, agree on that. Although this took a little bit of 
time, I am pleased that we came here today reaching agreements from 
earlier in the week.
  I spent my time working for a period of time at a publicly traded 
company. I saw firsthand the importance of having markets that operate 
efficiently but, also, fairly.
  Millions of Americans have retirement accounts, 401(k)s, and pensions 
as it relates to their retirement, and it is critical that those 
individuals can rely and trust the markets that they are relying on for 
their end of life.
  Millions of Americans are invested in these markets and these 
investments, the integrity of which is critical. They need to know that 
we are fighting on their behalf to ensure the game is not rigged to 
help and favor a privileged few.
  This bill includes, in particular, important clarifications that will 
improve our ability to police insider trading. It also incorporates 
changes supported by the ranking member in an amendment that I offered 
that I think provides important clarifications to allow the government 
to go after the bad guys.
  This will ensure the bill is targeted at bad behavior and does not 
inadvertently prevent people from engaging in legitimate trades. It 
strikes the balance that I think is crucial if we want to have vibrant 
and trustworthy public markets.
  I, again, want to urge my colleagues to support this nonpartisan 
legislation.
  Ms. WATERS. Madam Chair, I reserve the balance of my time.
  Mr. HUIZENGA. Madam Chair, I yield such time as he may consume to the 
gentleman from North Carolina (Mr. McHenry), the distinguished ranking 
member.
  Mr. McHENRY. Madam Chair, I thank the ranking member of the Investor 
Protection, Entrepreneurship, and Capital Markets Subcommittee, Mr. 
Huizenga, for his good work in committee and working on important 
legislation for economic growth and for his constituents in Michigan.
  Madam Chair, preventing and punishing bad actors for illegal insider 
trading is one of the top priorities of Republicans on the House 
Financial Services Committee because this illegal activity hurts 
everyday Main Street investors as well as the integrity and the 
efficiency of our markets.
  Trading on material insider information in breach of a fiduciary duty 
is currently prohibited by court-made law under the antifraud 
provisions of the Federal securities laws that we have. The Securities 
and Exchange Commission and the Department of Justice have the power to 
bring insider trading cases, and both agencies regularly exercise this 
power and have done so for decades.
  Our body of insider trading laws has been developed through those 
decades of judicial precedent to protect investors and the markets by 
punishing bad actors who illegally trade on insider information.
  Codifying nuanced case law and regulations that have been developed 
over decades into a single statute is really difficult. It is a very 
difficult undertaking, and it is, really, a very delicate piece of 
legislating that must occur.
  Both Republicans and Democrats who have served on the Securities and 
Exchange Commission have expressed concerns about Congress drafting a 
statute that accurately captures this extensive and expansive body 
of law without expanding it into new areas, inadvertently, perhaps, or 
perfectly by design in some areas.

  Moreover, bipartisanship is never easy. It is a give-and-take. It is 
a difficult process. I appreciate the gentleman from Connecticut (Mr. 
Himes)

[[Page H9274]]

for his willingness to work with us in a bipartisan manner.
  The bill on the floor today is not perfect, and, as the gentleman 
from Connecticut knows, I have several concerns with this bill.
  I have concerns about the lack of an explicit personal benefit test 
consistent with Supreme Court precedent.
  I am concerned that ambiguous language currently in the bill, such as 
``relating to the market,'' is ripe for activist judges and overzealous 
prosecutors and private plaintiffs to exploit, leading to greater 
uncertainty for anyone involved in investing. That is not what we want; 
that is not what we seek; and that should not be this undertaking. And 
I also don't believe that that is the intention of my colleague from 
Connecticut in the drafting of this bill.
  I am also troubled that the Rules Committee print before us does not 
include an exclusivity provision establishing that this bill is the 
insider trading law rather than just an additional action around 
insider trading.
  Finally, the Rules Committee print includes a rule of construction 
section that has yet to be vetted through the Financial Services 
Committee; and without a full understanding of the implications of this 
language, the bill could further open the door for activist judges, 
overzealous prosecutors, and trial lawyers, creating even more 
confusion around insider trading law.

                              {time}  1345

  That is not good for investors. That is not good for our markets. It 
is not good for anyone outside of a narrow few that personally benefit 
through fees around lawsuits.
  My amendment, which I will offer in a minute, addresses some of these 
concerns, and I appreciate my colleague from Connecticut, and I 
appreciate the chair of the Financial Services Committee, Ms. Waters, 
for their engagement so that we can actually come to a bipartisan 
agreement on this important act.
  Now, Republicans continue to support sensible bipartisan insider 
trading bills, such as the one that Chairwoman Waters and I brought 
forth, or she brought forth, as the first action of our committee on 
this House floor in this Congress, which was promoting Transparent 
Standards for Corporate Insiders Act, which we passed out of this 
Chamber. And starting off with the fact that we are going to be tough 
on bad actors from the Financial Services Committee and doing it in a 
bipartisan way shows our seriousness. And this bill before us is an 
addition to that seriousness that we take against bad actors in our 
area of jurisdiction.
  Finally, I would say this: We currently have out of decades of 
lawsuits, decades of regulatory enforcement, we have the greatest 
clarity on insider trading that we have ever had in this Nation, and 
that is due to two Supreme Court cases, in particular, giving us 
serious rules of the road. And I think that clarity is good. And what 
we want out of this legislation is to put in statute what is confirmed 
and established currently in the marketplace and currently in the 
courts of law.
  This is not to create more confusion or more lawsuits, but rather, 
codify what is a well-regulated, bright-line space that we currently 
have. And we want to take that consistency that we currently have and 
establish it in statute. And that is the reason why Republicans have 
engaged deeply with Democrats over the last 5 months to come to some 
reasonable conclusion on this important matter of banning insider 
trading.
  So Congress will have its say. I believe we will have a bipartisan 
vote for final passage, if my amendment is adopted, and I would hope 
that that would take place. And we have had good conversations along 
those lines, and I think we have workable language that could be 
acceptable to all in this body.
  I want to thank everyone who has participated, but most particularly 
Mr. Himes from Connecticut. While we don't agree on every issue--heck, 
I don't think you would get reelected in Connecticut if you agreed with 
me on every issue, nor I in North Carolina in my district--
bipartisanship is a hard thing, but if we are going to do big, 
important things, we have to try for that. And when you are in the 
majority, it is implicit you have more votes than those in the 
minority.
  So Democrats could pass this bill on their own. They could. And if 
they wanted to just use this as a political issue, they could just jam 
the language they have; they could, right? But it was your willingness 
to reach out, so that we could actually have a big bipartisan vote, 
rather than a narrow victory. That is also something that is a marker, 
that most in this country don't hear about, that we actually do talk. 
We may disagree on big things, we may, and from time to time Chairwoman 
Waters and I have had our public disagreements, but at the same time we 
have been able to come to terms on important things in our jurisdiction 
and get things done.
  So while that is not the everyday case for this Congress, when it 
happens, I think we should actually acknowledge it. Not that anybody is 
going to pat us on the back for it, but we should acknowledge it.
  I thank my colleagues on the Democrat side of the aisle for their 
work, and I thank my colleagues on the Republican side of the aisle for 
their work, as well.
  Mr. HUIZENGA. Madam Chair, I yield myself the balance of my time.
  Madam Chair, I would like to take this time to, again, congratulate 
the work that has been done. I do believe that there is additional work 
that is before us.
  I will be having an amendment that I will be offering a little later 
on, and at this point, I think, as it is coming together, there still 
is not going to be total agreement or total unanimity. You will see 
with the ranking member's amendment a number of Republicans who will 
join this bill. I believe that with the adoption of my amendment you 
would see even further Republican support of the underlying bill.
  There will be some dissent. There is dissent within the industry. 
There is dissent within those prosecutors and the regulators. As I had 
noted, both Republican and Democrat chairs of the SEC and commissioners 
of the SEC have said that having Congress act on this particular issue 
will set off a new chain of events, a new set of legal challenges that 
will take years to settle in the courts, as well, and they are 
comfortable with the options that they have the way current law has 
settled.
  Having said that, again, as the ranking member had said, in an 
attempt to codify a number of those Supreme Court rulings is 
commendable. I tend to be one who believes that Congress has a 
responsibility to review and look at and examine whether they should 
codify precedent.
  I find it interesting that on both sides this happens and with the 
regulators, and that everyone seems to pick and choose a little bit as 
to what subject area they would like to codify and what subject area 
they would continue to like to have flexibility on, based on those 
lawsuits.
  At this time the ranking member and his work with the gentleman from 
Connecticut has made significant progress, and I look forward to 
adopting the gentleman from North Carolina's amendment and the 
potential adoption of my amendment, as well, as we move forward.
  Madam Chair, I yield back the balance of my time.
  Ms. WATERS. Madam Chair, I yield myself the remainder of my time.
  Madam Chairwoman, H.R. 2534, the Insider Trading Prohibition Act, is 
a long overdue piece of legislation that simply spells out the 
definition of illegal insider trading under the securities laws. It 
creates clarity for participants in financial markets and empowers the 
SEC to punish bad actors.

  As we have discussed, this bill is supported by groups, including the 
Council of Institutional Investors, the California State Teachers' 
Retirement System, the North American Securities Administrators 
Association, Healthy Markets, and Public Citizen.
  Madam Chair, I thank the ranking member, Mr. McHenry, for his very 
kind comments. I thank him for his cooperation. I thank him for 
recognizing that it is possible to have bipartisan legislation. And I 
thank him for recognizing that Mr. Himes has worked very hard to ensure 
that he would have this as bipartisan legislation, rather than simply 
having the Democrats try to run roughshod over the opposite side of the 
aisle to get this done.
  I urge all Members to vote ``yes'' on this important bill. Madam 
Chair, I yield back the balance of my time.

[[Page H9275]]

  The CHAIR. All time for general debate has expired.
  Pursuant to the rule, the bill shall be considered for amendment 
under the 5-minute rule.
  In lieu of the amendment in the nature of a substitute recommended by 
the Committee on Financial Services, printed in the bill, an amendment 
in the nature of a substitute consisting of the text of Rules Committee 
Print 116-39, shall be considered as adopted.
  The bill, as amended, shall be considered as the original bill for 
the purpose of further amendment under the 5-minute rule and shall be 
considered as read.
  The text of the bill, as amended, is as follows:

                               H.R. 2534

       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 ``Insider Trading Prohibition 
     Act''.

     SEC. 2. PROHIBITION ON INSIDER TRADING.

       (a) In General.--The Securities Exchange Act of 1934 (15 
     U.S.C. 78a et seq.) is amended by inserting after section 16 
     the following new section:

     ``SEC. 16A. PROHIBITION ON INSIDER TRADING.

       ``(a) Prohibition Against Trading Securities While Aware of 
     Material, Nonpublic Information.--It shall be unlawful for 
     any person, directly or indirectly, to purchase, sell, or 
     enter into, or cause the purchase or sale of or entry into, 
     any security, security-based swap, or security-based swap 
     agreement, while aware of material, nonpublic information 
     relating to such security, security-based swap, or security-
     based swap agreement, or relating to the market for such 
     security, security-based swap, or security-based swap 
     agreement, if such person knows, or recklessly disregards, 
     that such information has been obtained wrongfully, or that 
     such purchase or sale would constitute a wrongful use of such 
     information.
       ``(b) Prohibition Against the Wrongful Communication of 
     Certain Material, Nonpublic Information.--It shall be 
     unlawful for any person whose own purchase or sale of a 
     security, security-based swap, or entry into a security-based 
     swap agreement would violate subsection (a), wrongfully to 
     communicate material, nonpublic information relating to such 
     security, security-based swap, or security-based swap 
     agreement, or relating to the market for such security, 
     security-based swap, or security-based swap agreement, to any 
     other person if--
       ``(1) the other person--
       ``(A) purchases, sells, or causes the purchase or sale of, 
     any security or security-based swap or enters into or causes 
     the entry into any security-based swap agreement, to which 
     such communication relates; or
       ``(B) communicates the information to another person who 
     makes or causes such a purchase, sale, or entry while aware 
     of such information; and
       ``(2) such a purchase, sale, or entry while aware of such 
     information is reasonably foreseeable.
       ``(c) Standard and Knowledge Requirement.--
       ``(1) Standard.--For purposes of this section, trading 
     while aware of material, nonpublic information under 
     subsection (a) or communicating material nonpublic 
     information under subsection (b) is wrongful only if the 
     information has been obtained by, or its communication or use 
     would constitute, directly or indirectly--
       ``(A) theft, bribery, misrepresentation, or espionage 
     (through electronic or other means);
       ``(B) a violation of any Federal law protecting computer 
     data or the intellectual property or privacy of computer 
     users;
       ``(C) conversion, misappropriation, or other unauthorized 
     and deceptive taking of such information; or
       ``(D) a breach of any fiduciary duty, a breach of a 
     confidentiality agreement, a breach of contract, a breach of 
     any code of conduct or ethics policy, or a breach of any 
     other personal or other relationship of trust and confidence.
       ``(2) Knowledge requirement.--It shall not be necessary 
     that the person trading while aware of such information (as 
     proscribed by subsection (a)), or making the communication 
     (as proscribed by subsection (b)), knows the specific means 
     by which the information was obtained or communicated, or 
     whether any personal benefit was paid or promised by or to 
     any person in the chain of communication, so long as the 
     person trading while aware of such information or making the 
     communication, as the case may be, was aware, consciously 
     avoided being aware, or recklessly disregarded that such 
     information was wrongfully obtained, improperly used, or 
     wrongfully communicated.
       ``(d) Derivative Liability.--Except as provided in section 
     20(a), no person shall be liable under this section solely by 
     reason of the fact that such person controls or employs a 
     person who has violated this section, if such controlling 
     person or employer did not participate in, or directly or 
     indirectly induce the acts constituting a violation of this 
     section.
       ``(e) Affirmative Defenses.--
       ``(1) In general.--The Commission may, by rule or by order, 
     exempt any person, security, or transaction, or any class of 
     persons, securities, or transactions, from any or all of the 
     provisions of this section, upon such terms and conditions as 
     it considers necessary or appropriate in furtherance of the 
     purposes of this title.
       ``(2) Directed trading.--The prohibitions of this section 
     shall not apply to any person who acts at the specific 
     direction of, and solely for the account of another person 
     whose own securities trading, or communications of material, 
     nonpublic information, would be lawful under this section.
       ``(3) Rule 10b-5-1 compliant transactions.--The 
     prohibitions of this section shall not apply to any 
     transaction that satisfies the requirements of Rule 10b-5-1 
     (17 C.F.R. 240.10b5-1), or any successor regulation.
       ``(f) Rule of Construction.--Section 10(b) and 14(e) and 
     any judicial precedents from judicial decisions under such 
     sections shall apply to the purchase or sale of or entry 
     into, any security, security-based swap, or security-based 
     swap agreement to the extent such decisions do not conflict 
     with the provisions of this section.''.
       (b) Commission Review of Rule 10b-5-1.--Not later than 180 
     days after the date of the enactment of this Act, the 
     Securities and Exchange Commission shall review Rule 10b-5-1 
     (17 C.F.R. 240.10b5-1) and make any modifications the 
     Securities and Exchange Commission determines necessary or 
     appropriate because of the amendment to the Securities 
     Exchange Act of 1934 made by this Act.
       (c) Conforming Amendments.--The Securities Exchange Act of 
     1934 (15 U.S.C. 78a et seq.) is further amended--
       (1) in section 21(d)(2), by inserting ``, section 16A of 
     this title'' after ``section 10(b) of this title,'';
       (2) in section 21A--
       (A) in subsection (g)(1), by inserting ``and section 16A,'' 
     after ``thereunder,''; and
       (B) in subsection (h)(1), by inserting ``and section 16A,'' 
     after ``thereunder,''; and
       (3) in section 21C(f), by inserting ``or section 16A,'' 
     after ``section 10(b)''.

  The CHAIR. No further amendment to the bill, as amended, shall be in 
order except those printed in House Report 116-320. Each such further 
amendment may be offered only in the order printed in the report, by a 
Member designated in the report, shall be considered read, shall be 
debatable for the time specified in the report equally divided and 
controlled by the proponent and an opponent, shall not be subject to 
amendment, and shall not be subject to a demand for division of the 
question.


                 Amendment No. 1 Offered by Mr. McHenry

  The CHAIR. It is now in order to consider amendment No. 1 printed in 
House Report 116-320.
  Mr. McHENRY. Madam Chair, I have an amendment at the desk.
  The CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 1, beginning on line 17, strike ``relating to the 
     market for'' and insert ``any nonpublic information, from 
     whatever source, that has, or would reasonably be expected to 
     have, a material effect on the market price of any''.
       Page 2, beginning on line 11, strike ``relating to the 
     market for'' and insert ``any nonpublic information, from 
     whatever source, that has, or would reasonably be expected to 
     have, a material effect on the market price of any''.
       Page 3, line 21, insert before the period the following: 
     ``for a direct or indirect personal benefit (including 
     pecuniary gain, reputational benefit, or a gift of 
     confidential information to a trading relative or friend)''.
       Page 5, strike lines 12 through 17 and insert a closing 
     quotation mark and a period.

  The CHAIR. Pursuant to House Resolution 739, the gentleman from North 
Carolina (Mr. McHenry) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from North Carolina.
  Mr. McHENRY. Madam Chair, as I just mentioned a few minutes ago, I 
have concerns with H.R. 2534, the Insider Trading Prohibition Act in 
its current form. And, Madam Chair, my amendment addresses several of 
these concerns and improves this bill to better demonstrate 
congressional intent of codifying current insider trading law and not 
expanding it.
  I thank the bill's sponsor, the gentleman from Connecticut (Mr. 
Himes) and his staff for their diligence and patience in working with 
us over the last few months and over the recent Thanksgiving holiday. I 
also want to thank both of our staffs, as well as the Waters' staff. 
And I want to thank Mr. Himes for agreeing to support this amendment in 
order to make this underlying bill a bipartisan approach to codify 
insider trading law and punish bad actors.
  My amendment reflects Republican priorities discussed at our May 
markup, such as the inclusion of an explicit personal benefit test 
consistent with Supreme Court precedent, the removal of the novel rule 
of construction section from the Rules print of this bill, and a 
clarification of ambiguous words to ensure judges and prosecutors know 
that this bill is not intended to expand or create new insider trading 
liability.

[[Page H9276]]

  The bill as drafted does not explicitly include the so-called 
personal benefit test, a significant element of insider trading law 
that prosecutors must currently satisfy in certain insider trading 
cases. In the 2016 Salman case, the Supreme Court noted that in order 
for a violation to have occurred, the insider or ``tipper'' providing 
the material, nonpublic information must have received a direct or 
indirect personal benefit, including but not limited to, pecuniary 
gain, reputational benefit, or a gift of confidential information to a 
trading relative or friend.
  Including an explicit personal benefit test, as set forth by the 
Supreme Court, ensures that this important test cannot be read more 
broadly by judges than the Supreme Court has allowed, and also, this 
prevents activist judges and overzealous prosecutors from reading the 
test out of law entirely.
  My amendment also clarifies the ambiguities within the ``relating to 
the market'' phrasing in the underlying bill. This phrase ``relating to 
the market'' is not a legal term of art defined within the existing 
body of insider trading law, nor is it defined in this bill. It is 
entirely plausible for an activist judge or a rogue prosecutor to 
interpret this phrase far more broadly than the drafters of the bill 
intended.
  This amendment provides a limiting principle by applying only to 
nonpublic information that has or is reasonably expected to have a 
material effect on the market price of a security. This ensures that 
the statute will still capture cases where the receipt of material, 
nonpublic information was not from the company itself, but from another 
source. This is referenced in the Supreme Court's 1987 Carpenter 
decision.
  Finally, my amendment strikes the rule of construction section in the 
underlying bill that was not reviewed or debated in the House Financial 
Services Committee. I believe this provision is, at best, unnecessary 
and at worst, could have been read as giving a congressional stamp of 
approval for a poorly reasoned judicial set of decisions.

                              {time}  1400

  As such, my amendment would ensure that Congress' intent is to simply 
codify existing law, not expand liability or create additional defenses 
for those accused of insider trading. This is about codifying what is 
already existent, period, end of statement.
  That being said, my amendment does not achieve all the Republican 
goals that we have previously outlined in our committee markup and 
committee hearing. Unfortunately, the bill, even if it is amended by 
this amendment, still will not contain an exclusivity provision to make 
this the exclusive law of the land for insider trading.
  While my amendment does not make this bill perfect, it does allow for 
Congress to exercise its Article I authority to produce a comprehensive 
insider trading law for the first time and does so in a bipartisan 
manner that simply intends, we believe, to codify current insider 
trading law without expanding liability to good-faith people innocent 
under the law.
  Mr. Chair, I urge its adoption, and I thank the bill's sponsor for 
working with us on it.
  Mr. Chair, I yield back the balance of my time.
  Ms. WATERS. Mr. Chair, I claim the time in opposition to the 
amendment, even though I am not opposed to it.
  The Acting CHAIR (Mr. Kennedy). Without objection, the gentlewoman 
from California is recognized for 5 minutes.
  There was no objection.
  Ms. WATERS. Mr. Chair, I yield myself such time as I may consume.
  First, I thank Ranking Member McHenry for offering this amendment to 
H.R. 2534 to help further ensure that this commonsense bill codifies 
the law against insider trading in a fair manner.
  When we marked up the bill in committee in May, I understood that my 
Republican colleagues had several concerns with the bill but 
nevertheless voiced their support in hopes of having those concerns 
addressed before the bill made its way to the House floor.
  At the end of the day, those concerns amounted to wanting additional 
clarity that H.R. 2534 reflected the current judge-made law against 
insider trading, aside from the controversial 2014 appeals court 
decision that has been subject to criticism from many sides.
  After months of discussion with the bill's sponsor, Representative 
Himes, Ranking Member McHenry has crafted this amendment to do just 
that. In particular, the amendment would clarify that the existing law 
that requires the SEC to establish some personal benefit to a tipper in 
cases involving tipper and tippee liability; clarify that the material, 
nonpublic information that forms the basis of liability may be related 
to either a specific security or to any security if that information 
would have or reasonably be expected to have a material effect on the 
market price of that security; and remove the rule of construction to 
avoid confusion and ambiguity and to ensure that this act is not the 
exclusive means by which the SEC, the Department of Justice, or private 
litigants may pursue insider trading.
  If the amendment is accepted, I believe that the bill would provide 
the SEC with clear additional authority to bring to justice corporate 
insiders and others who take unfair advantage of confidential 
information. In addition, because the bill uses the same terms 
identified in the current case law against insider trading, the SEC and 
market participants can easily understand what those terms mean.
  Again, Mr. Chair, I thank Ranking Member McHenry for strengthening 
the bill, and I urge my colleagues to join me in supporting this 
amendment.
  Mr. Chair, I yield the balance of my time to the gentleman from 
Connecticut (Mr. Himes), the sponsor of this important legislation.
  Mr. HIMES. Mr. Chairman, what is the balance of time available?
  The Acting CHAIR. The gentlewoman from California has 2\1/2\ minutes 
remaining.
  Mr. HIMES. Mr. Chairman, I thank Ranking Member Waters for yielding 
me time.
  I rise very briefly to welcome the amendment by Mr. McHenry. Mr. 
McHenry raised four substantive points. Three of those points are 
incorporated in this amendment, which we are very happy to accept.
  I think it is, again, not a compromise, but an improvement of the 
bill.
  In my very little remaining time, we did have discussions about 
exclusivity. As the ranking member knows, the idea here is to create a 
law under which insider trading is prosecuted. That is the objective.
  As the ranking member knows, it is a fairly complicated situation 
when including specific exclusivity language. Ultimately, that was not 
included in the ranking member's proposed amendment here, but we should 
continue to work together to make sure that this is about clarifying 
and simplifying and making more efficient rather than making more 
complex.
  Ms. WATERS. Mr. Chair, I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from North Carolina (Mr. McHenry).
  The amendment was agreed to.


                Amendment No. 2 Offered by Mr. Huizenga

  The Acting CHAIR. It is now in order to consider amendment No. 2 
printed in House Report 116-320.
  Mr. HUIZENGA. Mr. Chair, I have an amendment at the desk.
  The Acting CHAIR. The Clerk will designate the amendment.
  The text of the amendment is as follows:

       Page 1, line 10, strike ``Aware of'' and insert ``Using''.
       Page 1, line 14, strike ``aware of'' and insert ``using''.
       Page 2, line 22, strike ``aware of'' and insert ``using''.
       Page 2, beginning on line 24, strike ``aware of'' and 
     insert ``using''.
       Page 3, line 3, strike ``aware of'' and insert ``using''.
       Page 3, line 23, strike ``aware of'' and insert ``using''.

  The Acting CHAIR. Pursuant to House Resolution 739, the gentleman 
from Michigan (Mr. Huizenga) and a Member opposed each will control 5 
minutes.
  The Chair recognizes the gentleman from Michigan.
  Mr. HUIZENGA. Mr. Chair, I yield myself such time as I may consume.
  Mr. Chair, I will be brief. I am concerned that the bill before us 
today focuses specifically on awareness of information rather than the 
use of wrongful information in connection with security trading.

[[Page H9277]]

  Specifically, this bill defines trading while ``aware'' of material 
and nonpublic information or communicating material and nonpublic 
information as wrongful only if the information was obtained by way of, 
or its communication or use would constitute: theft, bribery, 
misrepresentation, espionage; a violation of Federal computer data and 
intellectual property protection and privacy laws; conversion, 
misappropriation, or other deceptive means; and any breach of a 
fiduciary duty, a contractual relationship, a code of conduct, or a 
personal confidence or trust.
  A person violates the bill's prohibitions on trading with and 
communicating material on nonpublic information so long as this person 
``knew'' the information was wrongfully obtained, actively avoided 
gaining such knowledge, or recklessly disregarded the wrongful use, 
communication, or obtainment of this information.
  It does not matter, under the bill, whether they know the method by 
which the information was obtained or communicated or if any benefit 
actually came from communication of the information.
  In short, Mr. Chair, I believe that this would, in turn, allow 
activist judges and prosecutors to go after individuals regardless of 
their intention or actual profit from wrongful actions.
  That is why my amendment is very simple. It would strike all 
occurrences of the phrase ``aware of'' and insert the word ``using.'' 
In other words, you can be aware of something, but if you are not going 
to actually use that information, why would you be held to a criminal 
standard?
  My amendment would have the effect of limiting who can be prosecuted 
under this bill to people who actually use wrongful information to gain 
a profit.
  As we all know, in our lives, there are all kinds of rumors around us 
all the time, whether it is about our work life or our family or 
whatever might be going on, somebody in the neighborhood. It is hard to 
know what information is actually true or actually accurate.
  What we have currently is this assumption that being aware of 
something makes you criminally liable versus actually using that 
information.
  The current bill could allow prosecution of people who traded and are 
simply aware of information but perhaps would have traded regardless of 
their awareness of that information.
  I am prepared to support this underlying bill with the adoption of my 
amendment.
  I was pleased to see the adoption of the amendment from the gentleman 
from North Carolina (Mr. McHenry). I believe these are perfecting 
amendments. I believe that these are issues that need to be further 
addressed.
  While I, too, have some concerns about exclusivity and some of the 
other things that the gentleman from North Carolina (Mr. McHenry) 
discussed, I believe that this particular issue is of significance, and 
it is sufficient enough and significant enough to pull my support 
across the finish line as we move forward on this.
  Mr. Chair, I urge all of my colleagues to accept this perfecting 
amendment, and I yield back the balance of my time.
  Ms. WATERS. Mr. Chair, I rise in opposition to the amendment.
  The Acting CHAIR. The gentlewoman from California is recognized for 5 
minutes.
  Ms. WATERS. Mr. Chair, I strongly oppose Representative Huizenga's 
amendment that replaces the bill's standard of illegal insider trading 
while ``aware of'' material, nonpublic information with trading while 
``using'' material, nonpublic information.
  This narrower standard is inconsistent with current law, would 
severely weaken the bill, and would create substantial enforcement 
hurdles to the benefit of bad actors and to the detriment of the SEC.
  If the amendment is adopted, the SEC would have to prove that the 
reason the defendant traded was because of a specific piece of 
information. That means that the SEC would have a hard time proving its 
case in court unless it had an email from a defendant explaining his 
motive for trading. Not many bad actors engaging in illegal insider 
trading are that dumb.
  Moreover, such a change would benefit insider traders at hedge funds 
or other market intelligence firms because they would merely have to 
tell the judge that they had other reasons or data to support their 
trade.
  The SEC's existing rule 10b-5 clearly states that the appropriate 
standard is awareness. Changing it to ``use,'' as Representative 
Huizenga's amendment would do, dramatically and substantially weakens 
the SEC's authority to prosecute insider trading.
  Mr. Chair, I urge my colleagues to reject the amendment offered by 
Mr. Huizenga.
  Mr. Chair, I yield the balance of my time to the gentleman from 
Connecticut (Mr. Himes), the sponsor of this important legislation.
  Mr. HIMES. Mr. Chairman, I thank Chairwoman Waters for yielding me 
the time.
  I rise in reluctant opposition to this amendment because it has been 
a hallmark of this process that I very much enjoyed working with Mr. 
McHenry and Mr. Huizenga. The reason I rise in opposition is really 
twofold or threefold.
  Number one, as Mr. Huizenga may recall, the original draft of the 
bill would make it prosecutable to prosecute somebody who is in 
possession of material, nonpublic information. My Republican friends 
correctly pointed out that we are often in possession of information 
that we may not be aware of. Certainly, if you were to take a look at 
my email inbox, you would know that to be true. So at the suggestion of 
the Republicans, we changed the standard from ``in possession'' to 
``aware of.''

  While I know that Mr. Huizenga is acting in good faith, Chairwoman 
Waters got it exactly right. If we go to a use standard, it would 
require prosecutors to actually get inside the motivation of why 
somebody made a trade. They would have to prove that you made this 
trade because you had inside information.
  In support of Mr. Huizenga's good faith, I understand where he is 
coming from, but let's also face that the confluence of circumstances 
where you have material, nonpublic information and you were going to do 
that trade at precisely that moment is a very, very rare event.
  While I understand where Mr. Huizenga is coming from, what I would 
suggest is, instead of creating probably an impossible prosecutorial 
burden, let's acknowledge that if in that very rare event where you 
want to make a trade and you happen to be in possession of material, 
nonpublic information, let that trade go by. That is rare enough that 
it shouldn't in any way, I think, speaking as somebody who has spent 
time in this industry, compromise the effectiveness or the efficiency 
of our capital markets.
  Again, reluctantly, I stand in opposition to Mr. Huizenga's 
amendment. I hope he will nonetheless support the underlying bill.
  Ms. WATERS. Mr. Chair, I yield back the balance of my time.
  The Acting CHAIR. The question is on the amendment offered by the 
gentleman from Michigan (Mr. Huizenga).
  The question was taken; and the Acting Chair announced that the noes 
appeared to have it.


                             Recorded Vote

  Mr. HUIZENGA. Mr. Chair, I demand a recorded vote.
  A recorded vote was ordered.
  The vote was taken by electronic device, and there were--ayes 196, 
noes 231, not voting 9, as follows:

                             [Roll No. 648]

                               AYES--196

     Abraham
     Aderholt
     Allen
     Amash
     Amodei
     Armstrong
     Arrington
     Babin
     Bacon
     Baird
     Balderson
     Banks
     Barr
     Bergman
     Bilirakis
     Bishop (NC)
     Bishop (UT)
     Bost
     Brady
     Brooks (AL)
     Brooks (IN)
     Buchanan
     Buck
     Bucshon
     Budd
     Burchett
     Burgess
     Byrne
     Calvert
     Carter (GA)
     Carter (TX)
     Chabot
     Cheney
     Cline
     Cloud
     Cole
     Collins (GA)
     Comer
     Conaway
     Cook
     Crawford
     Crenshaw
     Curtis
     Davidson (OH)
     Davis, Rodney
     DesJarlais
     Diaz-Balart
     Duncan
     Dunn
     Emmer
     Estes
     Ferguson
     Fitzpatrick
     Fleischmann
     Flores
     Fortenberry
     Foxx (NC)
     Fulcher
     Gaetz
     Gallagher
     Gianforte
     Gibbs
     Gohmert
     Gonzalez (OH)
     Gonzalez-Colon (PR)
     Gooden
     Granger
     Graves (GA)
     Graves (LA)
     Graves (MO)
     Green (TN)
     Griffith
     Grothman
     Guest

[[Page H9278]]


     Guthrie
     Hagedorn
     Harris
     Hartzler
     Hern, Kevin
     Herrera Beutler
     Hice (GA)
     Higgins (LA)
     Hill (AR)
     Holding
     Hollingsworth
     Hudson
     Huizenga
     Hurd (TX)
     Johnson (LA)
     Johnson (OH)
     Johnson (SD)
     Jordan
     Joyce (OH)
     Joyce (PA)
     Katko
     Keller
     Kelly (MS)
     Kelly (PA)
     King (IA)
     King (NY)
     Kinzinger
     Kustoff (TN)
     LaHood
     LaMalfa
     Lamborn
     Latta
     Lesko
     Long
     Loudermilk
     Lucas
     Luetkemeyer
     Marchant
     Marshall
     Massie
     Mast
     McCarthy
     McCaul
     McClintock
     McHenry
     McKinley
     Meadows
     Meuser
     Miller
     Mitchell
     Moolenaar
     Mooney (WV)
     Mullin
     Murphy (NC)
     Newhouse
     Norman
     Nunes
     Olson
     Palazzo
     Palmer
     Pence
     Perry
     Posey
     Ratcliffe
     Reed
     Reschenthaler
     Rice (SC)
     Riggleman
     Roby
     Rodgers (WA)
     Roe, David P.
     Rogers (AL)
     Rogers (KY)
     Rooney (FL)
     Rose, John W.
     Rouzer
     Roy
     Rutherford
     Scalise
     Schweikert
     Scott, Austin
     Sensenbrenner
     Shimkus
     Simpson
     Smith (MO)
     Smith (NE)
     Smith (NJ)
     Smucker
     Spano
     Stauber
     Stefanik
     Steil
     Steube
     Stewart
     Stivers
     Taylor
     Thompson (PA)
     Thornberry
     Timmons
     Tipton
     Turner
     Upton
     Wagner
     Walberg
     Walden
     Walker
     Walorski
     Waltz
     Watkins
     Weber (TX)
     Webster (FL)
     Wenstrup
     Westerman
     Williams
     Wilson (SC)
     Wittman
     Womack
     Woodall
     Wright
     Yoho
     Young
     Zeldin

                               NOES--231

     Adams
     Aguilar
     Allred
     Axne
     Barragan
     Bass
     Beatty
     Bera
     Beyer
     Bishop (GA)
     Blumenauer
     Blunt Rochester
     Bonamici
     Boyle, Brendan F.
     Brindisi
     Brown (MD)
     Brownley (CA)
     Bustos
     Butterfield
     Carbajal
     Cardenas
     Carson (IN)
     Case
     Casten (IL)
     Castor (FL)
     Castro (TX)
     Chu, Judy
     Cicilline
     Cisneros
     Clark (MA)
     Clarke (NY)
     Clay
     Cleaver
     Clyburn
     Cohen
     Connolly
     Cooper
     Correa
     Costa
     Courtney
     Cox (CA)
     Craig
     Crist
     Crow
     Cuellar
     Cunningham
     Davids (KS)
     Davis (CA)
     Davis, Danny K.
     Dean
     DeFazio
     DeGette
     DeLauro
     DelBene
     Delgado
     Demings
     DeSaulnier
     Deutch
     Dingell
     Doggett
     Doyle, Michael F.
     Engel
     Escobar
     Eshoo
     Espaillat
     Evans
     Finkenauer
     Fletcher
     Foster
     Frankel
     Fudge
     Gallego
     Garamendi
     Garcia (IL)
     Garcia (TX)
     Golden
     Gomez
     Gonzalez (TX)
     Gottheimer
     Green, Al (TX)
     Grijalva
     Haaland
     Harder (CA)
     Hastings
     Hayes
     Heck
     Higgins (NY)
     Himes
     Horn, Kendra S.
     Horsford
     Houlahan
     Hoyer
     Huffman
     Jackson Lee
     Jayapal
     Jeffries
     Johnson (GA)
     Johnson (TX)
     Kaptur
     Keating
     Kelly (IL)
     Kennedy
     Khanna
     Kildee
     Kilmer
     Kim
     Kind
     Kirkpatrick
     Krishnamoorthi
     Kuster (NH)
     Lamb
     Langevin
     Larsen (WA)
     Larson (CT)
     Lawrence
     Lawson (FL)
     Lee (CA)
     Lee (NV)
     Levin (CA)
     Levin (MI)
     Lewis
     Lieu, Ted
     Lipinski
     Loebsack
     Lofgren
     Lowenthal
     Lowey
     Lujan
     Luria
     Lynch
     Malinowski
     Maloney, Carolyn B.
     Maloney, Sean
     Matsui
     McAdams
     McBath
     McCollum
     McEachin
     McGovern
     McNerney
     Meeks
     Meng
     Moore
     Morelle
     Moulton
     Mucarsel-Powell
     Murphy (FL)
     Nadler
     Napolitano
     Neal
     Neguse
     Norcross
     Norton
     O'Halleran
     Ocasio-Cortez
     Omar
     Pallone
     Panetta
     Pappas
     Pascrell
     Payne
     Perlmutter
     Peters
     Peterson
     Phillips
     Pingree
     Plaskett
     Pocan
     Porter
     Pressley
     Price (NC)
     Quigley
     Raskin
     Rice (NY)
     Richmond
     Rose (NY)
     Rouda
     Roybal-Allard
     Ruiz
     Ruppersberger
     Rush
     Ryan
     Sablan
     Sanchez
     Sarbanes
     Scanlon
     Schakowsky
     Schiff
     Schneider
     Schrader
     Schrier
     Scott (VA)
     Scott, David
     Sewell (AL)
     Shalala
     Sherman
     Sherrill
     Sires
     Slotkin
     Smith (WA)
     Soto
     Spanberger
     Speier
     Stanton
     Stevens
     Suozzi
     Swalwell (CA)
     Takano
     Thompson (CA)
     Thompson (MS)
     Titus
     Tlaib
     Tonko
     Torres (CA)
     Torres Small (NM)
     Trahan
     Trone
     Underwood
     Van Drew
     Vargas
     Veasey
     Vela
     Velazquez
     Visclosky
     Wasserman Schultz
     Waters
     Watson Coleman
     Welch
     Wexton
     Wild
     Yarmuth

                             NOT VOTING--9

     Biggs
     Cartwright
     Gabbard
     Gosar
     Hunter
     Radewagen
     San Nicolas
     Serrano
     Wilson (FL)

                              {time}  1442

  Mses. McCOLLUM, FUDGE, Messrs. LOEBSACK, PETERS, SEAN PATRICK MALONEY 
of New York, PHILLIPS, DANNY K. DAVIS of Illinois, Mrs. LURIA, Mses. 
WASSERMAN SCHULTZ, MUCARSEL-POWELL, Messrs. MALINOWSKI, NADLER, ROSE of 
New York, CICILLINE, CLYBURN, PAYNE, Ms. BASS, and Mrs. HAYES changed 
their vote from ``aye'' to ``no.''
  Messrs. BUCHANAN, LAMBORN and JOHNSON of Louisiana changed their vote 
from ``no'' to ``aye.''
  So the amendment was rejected.
  The result of the vote was announced as above recorded.
  The Acting CHAIR (Mr. Payne). There being no further amendments, 
under the rule, the Committee rises.
  Accordingly, the Committee rose; and the Speaker pro tempore (Mr. 
Kennedy) having assumed the chair, Mr. Payne, Acting Chair of the 
Committee of the Whole House on the state of the Union, reported that 
that Committee, having had under consideration the bill (H.R. 2534) to 
amend the Securities Exchange Act of 1934 to prohibit certain 
securities trading and related communications by those who possess 
material, nonpublic information, and, pursuant to House Resolution 739, 
he reported the bill, as amended by that resolution, back to the House 
with a further amendment adopted in the Committee of the Whole.
  The SPEAKER pro tempore. Under the rule, the previous question is 
ordered.
  The question is on the amendment.
  The amendment was agreed to.
  The SPEAKER pro tempore. The question is on the engrossment and third 
reading of the bill.
  The bill was ordered to be engrossed and read a third time, and was 
read the third time.
  The SPEAKER pro tempore. The question is on the passage of the bill.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Ms. WATERS. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 9 of rule XX, this 5-
minute vote on passage of the bill will be followed by 5-minute votes 
on ordering the previous question on House Resolution 741; and adoption 
of House Resolution 741, if ordered.
  The vote was taken by electronic device, and there were--yeas 410, 
nays 13, not voting 7, as follows:

                             [Roll No. 649]

                               YEAS--410

     Abraham
     Adams
     Aderholt
     Aguilar
     Allen
     Allred
     Amodei
     Arrington
     Axne
     Babin
     Bacon
     Baird
     Balderson
     Banks
     Barr
     Barragan
     Bass
     Beatty
     Bera
     Bergman
     Beyer
     Bilirakis
     Bishop (GA)
     Bishop (UT)
     Blumenauer
     Blunt Rochester
     Bonamici
     Bost
     Boyle, Brendan F.
     Brady
     Brindisi
     Brooks (AL)
     Brooks (IN)
     Brown (MD)
     Brownley (CA)
     Buchanan
     Buck
     Bucshon
     Budd
     Burchett
     Burgess
     Bustos
     Butterfield
     Byrne
     Calvert
     Carbajal
     Cardenas
     Carson (IN)
     Carter (GA)
     Carter (TX)
     Case
     Casten (IL)
     Castor (FL)
     Castro (TX)
     Chabot
     Cheney
     Chu, Judy
     Cicilline
     Cisneros
     Clark (MA)
     Clarke (NY)
     Clay
     Cleaver
     Cline
     Cloud
     Clyburn
     Cohen
     Cole
     Collins (GA)
     Comer
     Conaway
     Connolly
     Cook
     Cooper
     Correa
     Costa
     Courtney
     Cox (CA)
     Craig
     Crawford
     Crenshaw
     Crist
     Crow
     Cuellar
     Cunningham
     Curtis
     Davids (KS)
     Davis (CA)
     Davis, Danny K.
     Davis, Rodney
     Dean
     DeFazio
     DeGette
     DeLauro
     DelBene
     Delgado
     Demings
     DeSaulnier
     DesJarlais
     Deutch
     Diaz-Balart
     Dingell
     Doggett
     Doyle, Michael F.
     Duncan
     Dunn
     Emmer
     Engel
     Escobar
     Espaillat
     Estes
     Evans
     Ferguson
     Finkenauer
     Fitzpatrick
     Fleischmann
     Fletcher
     Flores
     Fortenberry
     Foster
     Foxx (NC)
     Frankel
     Fudge
     Fulcher
     Gaetz
     Gallagher
     Gallego
     Garamendi
     Garcia (IL)
     Garcia (TX)
     Gianforte
     Gibbs
     Gohmert
     Golden
     Gomez
     Gonzalez (OH)
     Gonzalez (TX)
     Gooden
     Gottheimer
     Granger
     Graves (GA)
     Graves (LA)
     Graves (MO)
     Green (TN)
     Green, Al (TX)
     Grijalva
     Grothman
     Guest
     Guthrie
     Haaland
     Hagedorn
     Harder (CA)
     Hartzler
     Hastings
     Hayes
     Heck
     Hern, Kevin
     Herrera Beutler
     Hice (GA)
     Higgins (LA)
     Higgins (NY)
     Himes
     Holding
     Hollingsworth
     Horn, Kendra S.
     Horsford
     Houlahan
     Hoyer
     Hudson
     Huffman
     Hurd (TX)
     Jackson Lee
     Jayapal
     Jeffries
     Johnson (GA)
     Johnson (LA)
     Johnson (OH)
     Johnson (SD)
     Johnson (TX)
     Jordan
     Joyce (OH)
     Joyce (PA)
     Kaptur
     Katko
     Keating
     Keller
     Kelly (IL)
     Kelly (MS)
     Kelly (PA)
     Kennedy
     Khanna
     Kildee
     Kilmer
     Kim
     Kind
     King (NY)
     Kinzinger
     Kirkpatrick
     Krishnamoorthi
     Kuster (NH)
     Kustoff (TN)
     LaHood
     LaMalfa
     Lamb
     Lamborn
     Langevin
     Larsen (WA)
     Larson (CT)
     Latta
     Lawrence
     Lawson (FL)
     Lee (CA)
     Lee (NV)
     Lesko
     Levin (CA)
     Levin (MI)
     Lewis
     Lieu, Ted
     Lipinski
     Loebsack
     Lofgren
     Long
     Loudermilk
     Lowenthal
     Lowey
     Lucas
     Luetkemeyer
     Lujan
     Luria
     Lynch
     Malinowski
     Maloney, Carolyn B.
     Maloney, Sean
     Marchant
     Marshall
     Mast
     Matsui
     McAdams
     McBath
     McCarthy
     McCaul
     McClintock
     McCollum

[[Page H9279]]


     McEachin
     McGovern
     McHenry
     McKinley
     McNerney
     Meadows
     Meeks
     Meng
     Meuser
     Miller
     Mitchell
     Moolenaar
     Mooney (WV)
     Moore
     Morelle
     Moulton
     Mucarsel-Powell
     Mullin
     Murphy (FL)
     Murphy (NC)
     Nadler
     Napolitano
     Neal
     Neguse
     Newhouse
     Norcross
     Norman
     Nunes
     O'Halleran
     Ocasio-Cortez
     Olson
     Omar
     Palazzo
     Pallone
     Palmer
     Panetta
     Pappas
     Pascrell
     Payne
     Pence
     Perlmutter
     Perry
     Peters
     Peterson
     Phillips
     Pingree
     Pocan
     Porter
     Posey
     Pressley
     Price (NC)
     Quigley
     Raskin
     Ratcliffe
     Reschenthaler
     Rice (NY)
     Rice (SC)
     Richmond
     Riggleman
     Roby
     Rodgers (WA)
     Roe, David P.
     Rogers (AL)
     Rogers (KY)
     Rooney (FL)
     Rose (NY)
     Rose, John W.
     Rouda
     Rouzer
     Roybal-Allard
     Ruiz
     Ruppersberger
     Rush
     Rutherford
     Ryan
     Sanchez
     Sarbanes
     Scalise
     Scanlon
     Schakowsky
     Schiff
     Schneider
     Schrader
     Schrier
     Schweikert
     Scott (VA)
     Scott, Austin
     Scott, David
     Sensenbrenner
     Sewell (AL)
     Shalala
     Sherman
     Sherrill
     Shimkus
     Simpson
     Sires
     Slotkin
     Smith (MO)
     Smith (NE)
     Smith (NJ)
     Smith (WA)
     Smucker
     Soto
     Spanberger
     Spano
     Speier
     Stanton
     Stauber
     Stefanik
     Steil
     Steube
     Stevens
     Stewart
     Stivers
     Suozzi
     Swalwell (CA)
     Takano
     Taylor
     Thompson (CA)
     Thompson (MS)
     Thompson (PA)
     Thornberry
     Timmons
     Tipton
     Titus
     Tlaib
     Tonko
     Torres (CA)
     Torres Small (NM)
     Trahan
     Trone
     Turner
     Underwood
     Upton
     Van Drew
     Vargas
     Veasey
     Vela
     Velazquez
     Visclosky
     Wagner
     Walberg
     Walden
     Walker
     Walorski
     Waltz
     Wasserman Schultz
     Waters
     Watkins
     Watson Coleman
     Weber (TX)
     Webster (FL)
     Welch
     Wenstrup
     Westerman
     Wexton
     Wild
     Williams
     Wilson (FL)
     Wilson (SC)
     Wittman
     Womack
     Woodall
     Wright
     Yarmuth
     Young
     Zeldin

                                NAYS--13

     Amash
     Armstrong
     Biggs
     Bishop (NC)
     Davidson (OH)
     Griffith
     Harris
     Hill (AR)
     Huizenga
     King (IA)
     Massie
     Roy
     Yoho

                             NOT VOTING--7

     Cartwright
     Eshoo
     Gabbard
     Gosar
     Hunter
     Reed
     Serrano

                              {time}  1453

  Mr. CRAWFORD changed his vote from ``nay'' to ``yea.''
  So the bill was passed.
  The result of the vote was announced as above recorded.
  A motion to reconsider was laid on the table.
  Stated for:
  Ms. ESHOO. Mr. Speaker, I was unable to be present during roll call 
vote number 649. Had I been present, I would have voted: on roll call 
vote number 649, YES.

                          ____________________