Treasury Secretary Bessent, citing lawmakers’ “eye-popping” investment returns, is injecting new energy into years-long effort to prohibit congressional stock trading.
The former hedge fund manager shared his plan to push for a single-stock trading ban during an interview with Bloomberg Television on Wednesday, warning that congressional investment activity threatens “the credibility of the House and the Senate.”
Mr. Bessent specifically highlighted the trading records of Representative Nancy Pelosi and Senator Ron Wyden, both of whom have generated substantial investment gains over the past year. “Every hedge fund would be jealous of them,” Mr. Bessent remarked.
“People shouldn’t come to Washington to get rich, they should come to serve the American people,” the Treasury head emphasized. “If any private citizen traded this way, the SEC would be knocking on their door.”
While members of Congress are already prohibited from using non-public information for personal trading under the 2012 Stop Trading on Congressional Knowledge Act, critics argue the law has failed to address the problem effectively. The legislation requires lawmakers to disclose trades exceeding $1,000 within 45 days, but enforcement has been inconsistent and penalties remain minimal.
In the past year alone, at least ten lawmakers from both parties have violated the Act’s disclosure requirements.
The investment activities of Paul Pelosi, husband of former House Speaker, Nancy Pelosi, have become a particular flashpoint in the debate. His well-timed trades generated an estimated 54 percent return in 2024, substantially outperforming both the S&P 500 and many major hedge funds.
The portfolio’s remarkable success has spawned its own following, including an automated fund called the “Pelosi Tracker” that mirrors Mr. Pelosi’s trades. President Trump recently accused the Pelosis of using “inside information” to “beat every hedge fund in 2024.”
Ms. Pelosi has consistently denied involvement in her husband’s trading decisions and responded to the president’s comment by defending lawmakers’ rights to participate in the “free market economy.”
The debate gained renewed urgency in 2020 when several lawmakers faced scrutiny for potentially using COVID-19 briefings to make advantageous trades before the market crash. While Department of Justice investigations produced no charges, the controversy thrust congressional portfolios into the public spotlight.
Now, concrete legislative action appears within reach. Last month, the Senate Homeland Security and Governmental Affairs Committee advanced Senator Josh Hawley’s proposal to ban lawmakers and their spouses from trading individual stocks during their time in office.
The measure, aptly named PELOSI Act, would extend restrictions to presidents and vice presidents, though it would not apply to President Trump since it would only take effect at the start of officials’ next terms.
“Americans have watched politicians earn a fortune using information not available to the general public while the average family struggles to get by. It’s just wrong,” Mr. Hawley stated when introducing his legislation. “Members of Congress should be focused on delivering results for their constituents, not returns on investments.”