Can’t stop, won’t stop: Another congressman violates STOCK Act

Can’t stop, won’t stop: Another congressman violates STOCK Act
Image via screengrab/@RepAdrianSmit/Twitter.

A dozen lawmakers have now violated a federal conflicts-of-interest and financial disclosure law in 2023 — the latest a Republican representative from Nebraska, according to a Raw Story analysis of congressional financial documents.

Rep. Adrian Smith (R-NE) was more than a year late disclosing some of his wife’s purchases of stock in CarterBaldwin, an executive search firm, according to a new congressional financial disclosure.

By law, Smith had 45 days to publicly report his wife’s purchases, all made between January 2022 and February 2023 and together valued between $3,003 and $45,000. (Federal lawmakers are only required to disclose the value of such stock purchases in broad ranges.)

“Representative Smith became aware of a potential oversight while filing his financial disclosures on May 15,” said Tiffany Haverly, a spokesperson for Smith. “The transactions not reported were spouse transactions related to her employment, which is not a publicly traded company. He does not own any publicly traded stocks and immediately contacted the House Ethics Committee to notify them of the potential oversight and seek additional guidance.”

Smith paid the standard $200 fee for filing a late disclosure, Haverly told Raw Story.

“He quickly took action and filed all necessary disclosures on May 23. He also sent payment to the Treasury to cover any late fees that may be associated with the inadvertent late filing of these transaction reports while they are being reviewed,” Haverly said in a statement. “The congressman regrets the error, is committed to transparency, and will report these transactions in accordance with the law moving forward.”

Continued violations

The Stop Trading on Congressional Knowledge Act of 2012 requires members of Congress — within 45 days — to report any individual stock, bond, Treasury security or cryptocurrency transactions they, their spouses or dependent children conduct.

But dozens have failed to comply. During the 117th Congress from 2021 to 2022, at least 78 members of Congress — Democrats and Republicans alike — were found to have violated the STOCK Act's disclosure provisions, according to a tally maintained by Insider.

Including Smith, Raw Story has identified nine members of Congress who violated the STOCK Act in the month of May alone, and 12 overall this year.

Six representatives failing to report up to $376,280 in stock transactions last week were Rep. Jonathan Jackson (D-IL), Rep. Debbie Dingell (D-MI), Rep. Russ Fulcher (R-ID), Rep. Marcy Kaptur (D-OH), Rep. Deborah Ross (D-NC) and Rep. John Sarbanes (D-MD).

Rep. Zoe Lofgren (D-CA), who last year led Democratic House leadership’s self-aborted effort to ban congressional stock trading, also violated the STOCK Act last week with up to $265,000 in late financial disclosures, Raw Story reported.

The week before Raw Story broke the news that Rep. Dan Bishop (R-NC) was late in disclosing up to $5 million in U.S. Treasury note purchases.

Earlier this year, Raw Story reported other STOCK Act violations, breaking the news that Rep. Seth Moulton (D-MA) failed to properly disclose that his wife sold up to $100,000 worth of stock in gaming company Activision Blizzard in September 2022 and purchased up to $15,000 worth of stock in in August 2022.

Raw Story reported that Rep. Gerry Connolly (D-VA) was several days late disclosing that he had sold personal stock in an energy company and a pair of federal defense contractors. Sen. Tom Carper (D-DE) also violated the STOCK Act in March with a late disclosure.

Rep. Adrian Smith (R-NE) violated the STOCK Act when he was late disclosing three of his spouse's stock purchases. Chip Somodevilla/Getty Images

Congressional stock ban efforts

The ongoing violations come at a time when a bipartisan group of lawmakers have introduced several similar bills aimed at banning congressional stock trading.

The most recent bill to be introduced this session — the Bipartisan Restoring Faith in Government Act — is co-sponsored in part by political rivals in Reps. Alexandria Ocasio-Cortez (D-NY) and Matt Gaetz (R-FL).

Other materially similar bills include the Ending Trading and Holdings in Congressional Stocks (ETHICS) Act, the TRUST in Congress Act and the Preventing Elected Leaders from Owning Securities and Investments Act.

The STOCK Act was passed by Congress in 2012 to prevent insider trading, promote transparency and reduce conflicts of interest among federal lawmakers and other government officials.

In the decade since, the push for a total ban on lawmakers trading stocks while in office gained but then lost momentum last year when the Democratic-led House, then led by Speaker Emerita Nancy Pelosi, decided not to conduct a hearing on any of stock-ban bills and never brought it to the House floor for a vote.

News organizations including the New York Times, Insider, NPR and Sludge have documented rampant financial conflicts of interests among dozens of members of Congress, such as those who bought and sold defense contractor stock while occupying positions on congressional armed services committees or otherwise voting on measures to send such companies billions of federal dollars. The executive and judicial branches are riddled with similar financial conflict issues, too, as the Wall Street Journal has reported.

The Wall Street Journal won a 2023 Pulitzer Prize for its investigation into financial conflicts among officials who work in federal agencies while Insider won the Society of Professional Journalists’ Sunshine Award for its reporting on congressional financial conflicts.

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