Voters have a right to know whether their elected officials are prioritizing their own wallets over the needs of the public, and for years, much focus has rightfully been paid to the stock trading activities of those in power.
Although criticism of laws regulating congressional stock trading has focused on the lack of meaningful protection against insider trading, another significant issue that gets less attention is the lack of meaningful transparency of the stock holdings of lawmakers and staff.
Under the Stop Trading on Congressional Knowledge (STOCK) Act and other regulations governing the activities of members of Congress, officeholders and candidates, high-ranking staffers are required to publicly disclose on an annual basis their financial holdings, including stock ownership, business interests, outside income, other positions held and liabilities.
Additionally, members and high-ranking staffers must file disclosure forms known as Periodic Transaction Reports (PTR) within 30 days of any stock transaction.
While the disclosure requirements imposed by the STOCK Act were an important first step toward addressing concerns about Congressional conflicts of interest and insider trading, the goal of meaningful transparency remains unachieved.
Rather, barriers to information remain in place, preventing the public from holding Congress accountable for actual or perceived corruption.
When the STOCK Act was first passed in 2012, the legislation included a plan to create a searchable, sortable and downloadable database, so the public could easily and efficiently identify potential conflicts of interest in lawmakers’ stock holdings.
In 2013, just one year after the STOCK Act was signed into law, the planned database was scrapped.
Now, if members of the public want to find financial disclosures for members or candidates, they can find them on internet databases maintained by the House and Senate. These databases only allow searches by filer name, year and type of form. Discovering suspect holdings or trades requires a manual review of the documents.
In addition to the formidable volume of reports (at least 535 members and dozens of candidates file reports annually, and hundreds of PTRs are also submitted each year), format issues can make comprehensive reviews of Congressional stock ownership particularly burdensome.
The forms are not always text searchable, and some members file handwritten (and occasionally illegible) reports.
Obtaining staffer disclosures is even more difficult, necessitating a visit to Capitol Hill. This creates logistical challenges (escalated by post-January 6 security measures), even for those that live or work in the District of Columbia.
Alternatively, members of the public can make a request from the Senate Office of Public Records or House Legislative Resource Center and have the documents mailed.
The cost of obtaining these documents can add up – at 20 cents per page, and printing multiple disclosure forms (some of which are dozens of pages long) can be prohibitively expensive.
Disclosure is key to addressing the very real problem of insider trading and public trust in Congress. By the very nature of their job, lawmakers and their staff enjoy influence and access to sensitive information.
Voters have a right to know whether Congress is acting in the public’s best interest or to advance their own financial interests. But disclosure only works if information is truly accessible. Otherwise, Congress can continue to hold problematic stocks in plain sight.