[Congressional Record (Bound Edition), Volume 158 (2012), Part 1]
[Senate]
[Pages 1361-1362]
[From the U.S. 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-- 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

[[Page 1362]]

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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