Remember the 60 Minutes piece about Congressional Insider trading? Well now that everyone knows about it, it appears the Stock Act (blocking insider trading by congress) may be passed. Will it be enforced? Will the SEC be afraid to enforce it? Time will tell.
From Yahoo:
From Yahoo:
2 comments:
The current laws under section 10(b) of the Securities Exchange Act of 1934 (Exchange Act), and under federal statutes prohibiting mail fraud or wire fraud, already apply to members of Congress, but Congress hampers adequate enforcement by refusing prompt public disclosure. The laws apply, but are unenforceable against elected public officials. The laws cannot be enforced against members of congress because they refuse to disclose information in the time permitted for everybody else. The delayed reporting of securities transactions, defeats, obstructs, and impairs its use as timely evidence.
It looks as though self-interested congressional officials do not want to put an end to the lucrative trading opportunities that are made available to them when they receive important nonpublic information in their official capacities.
The loophole in which members of congress and legislative staffers are immune from enforcement of insider-trading laws, is because the delayed reporting of securities transactions by congress, defeats, obstructs, and impairs its use as timely evidence. Insider-trading cases are hard to prove, because the trades must be tightly linked to the events or information on which they are allegedly based.
Trades need to be disclosed in "real time or near real time," so that the memories of potential witnesses are fresh and suspects do not have time to cover up their actions. The SEC, which conducts most insider-trading investigations, urged faster disclosure of stock trades by members of Congress on electronic, searchable forms. This is why no Congress people were investigated under the current laws.
Post a Comment