Media stories erupted recently about Rep. Nancy Pelosi’s (D-CA) financial dealings.
“Stock market watchdog claims Nancy Pelosi raked in $4.7M in a single day of trading,” reads one headline about the 38-year House member from San Francisco, who was speaker from 2007 to 2011 and 2019 to 2023.
“Nancy Pelosi outperforms major hedge funds with jaw-dropping gains in 2024, leaves Wall Street pros in the dust,” another report exclaimed.
This was not the first such press scrutiny. The California Democrat’s high-performing portfolio has long been the subject of critical media stories. Last year, for example, financial disclosures revealed the California Democrat had sold at least $500,000 in Visa stock a few months before the Justice Department announced an antitrust investigation of the firm. Three years ago, tech entrepreneur Chris Josephs built the Pelosi Stock Tracker, which displays her assets and their impressive performance.
As in the past, a spokesperson told the press that Pelosi “does not own any stocks, and she has no prior knowledge or subsequent involvement in any transactions.” The assets are in an account held by her husband, Paul Pelosi, who is a very experienced investor and financier.
To be sure, the former speaker is not the only public official whose financial dealings have raised eyebrows. Nor are Democrats the only ones who are suspected of wheeling and dealing on Capitol Hill.
Sen. Tommy Tuberville (R-AL) sold Apple stock shortly before President Donald Trump announced tariffs that drove down the share prices. Rep. Marjorie Taylor Greene (R-GA) purchased a bevy of technology stocks shortly before Trump paused some tariffs — she told the press there was no problem as her investments are managed by an outside adviser.
These are among many people in Congress who often see gains in their stock portfolio that outpace the growth of the Standard & Poor 500.
Charges of legislative graft are as old as the republic itself. Thomas Jefferson and his co-partisans accused Alexander Hamilton and his supporters of colluding with stock-jobbers to line their pockets. In the 1870s, legislators were gifted artificially low-priced railroad stock options to encourage them to vote for legislation favorable to the building of a transcontinental rail system.
Nobody would know about the stock transactions of Pelosi, Greene, and Tuberville if it were not for the Stop Trading on Congressional Knowledge Act, enacted in 2012. It declared that legislators and top executive branch officials were covered by existing laws forbidding insider trading, or the purchasing or selling of an asset based upon nonpublic knowledge. The STOCK Act also required the timely disclosure of legislators’ stock purchases and sales.
The frequent media stories about legislators’ well-timed stock trades over the past several years have fomented a slew of bills to toughen up the STOCK Act and other rules forbidding the co-mingling of officials’ powers and personal wealth.
For example, Rep. Seth Magaziner (D-RI) reintroduced the Transparent Representation Upholding Service and Trust in Congress Act, which would force legislators to put their investments in blind trusts and have no visibility into any trades. Across the Capitol, Sen. Josh Hawley (R-MO) introduced the Preventing Elected Leaders from Owning Securities Act, which would forbid legislators and their spouses from holding, purchasing, or selling individual stocks. They could continue to invest in mutual funds, exchange-traded funds, and U.S. Treasury bonds. Supporters for these bills range from self-professed socialist Rep. Alexandria Ocasio-Cortez (D-NY) to the very conservative Rep. Chip Roy (R-TX) and the House Freedom Caucus.
Groups outside Congress are also clamoring for additional curbs. Richard Eidlin, the policy director of Business for America, a group that educates and advocates on a variety of civic matters, told the Washington Examiner, “This type of financial activity by members of Congress … making financial decisions while also acting as regulators and policymakers presents tremendous conflicts of interest.” When public officials profit on inside information gleaned from their positions, Eidlin added, “it depreciates the public’s trust in the political system” and “challenges the notion of free and fair markets.” BFA is one of nearly a dozen groups that recently signed a letter asking Congress to tighten the laws on stock trading.
Whether legislators will have the chance to vote for any of these bills is unclear. Neither chamber so far has agreed to vote on any particular bill. Similar legislation introduced in the two previous Congresses died from inaction.
Senate Majority Leader John Thune (R-SD), perhaps seeing limited support within his caucus, has not taken a position. “We’ll see how this conversation evolves,” he said. “I mean, we get some members up here on both sides, out both sides of the Capitol, as you know, who would like more strict limitations on that. But there are some pretty good, I would say, protections in place already.”
House Speaker Mike Johnson (R-LA), for his part, says he supports a ban on stock trading.
“I’m in favor of that because I don’t think we should have any appearance of impropriety here,” Johnson told reporters on May 14.
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House Minority Leader Hakeem Jeffries (D-NY) has also voiced support, and President Donald Trump has said he would sign such a bill. “Absolutely,” he told the press.
“I watched Nancy Pelosi get rich through insider information, and I would be OK with it,” Trump said in late April. “If they send that to me, I would do it.”
Kevin R. Kosar (@kevinrkosar) is a senior fellow at the American Enterprise Institute and edits UnderstandingCongress.org.