A bipartisan push to sever the financial ties between federal lawmakers and Wall Street gained significant momentum Thursday as Senators Ashley Moody (R-FL) and Kirsten Gillibrand (D-NY) formally unveiled the “Restore Trust in Congress Act.” The sweeping legislation seeks to prohibit Members of Congress, their spouses, and dependent children from trading or owning individual stocks.
The proposal arrives as a companion to a House effort already in motion, spearheaded by Representatives Chip Roy and Seth Magaziner. That version of the bill has swelled to 124 cosponsors, with 78 representatives signing a discharge petition in an attempt to force the matter to a floor vote.
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“It is fundamental to our Republic that members of Congress are focused on our nation and its citizens’ well-being, not how they may financially profit from their positions,” the senators stated in a joint release, framing the bill as a “commonsense” necessity.
Under the text of the proposed legislation, the ban casts a wide net over “covered investments.” This definition includes individual securities, commodities, futures, and synthetic economic interests like derivatives. The prohibition extends explicitly to the immediate families of lawmakers, closing a loophole often criticized by ethics watchdogs.
However, the bill stops short of a total investment freeze. Lawmakers would remain free to invest in widely held, diversified mutual funds, U.S. Treasury bills, and state or municipal bonds. Exceptions are also carved out for small business interests and real estate held as a primary residence.
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If passed, the law would force a rapid restructuring of congressional portfolios. Current members would face a 180-day deadline to divest their specific stock holdings, while new members entering Congress would be granted a 90-day window to comply.
The legislation also outlines specific “teeth” for enforcement. Violators would face a penalty fee equal to 10 percent of the value of the prohibited investment. Furthermore, any profits gained from a violation must be disgorged to the U.S. Treasury. To ensure transparency, supervising ethics offices would be mandated to maintain a public website documenting all fines assessed and the specific reasons for the penalties.
While qualified blind trusts are generally required to be divested under the act, certain family trusts may be granted exceptions if the lawmaker plays no role in the trust’s management or contributions.
“We will continue to fight tirelessly to make sure it becomes law,” the senators added.
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