But if insider trading represents a sort of theft from a client or employer, it raises something of a conundrum: members of Congress don’t really have an employer. The law professor Donna Nagy has argued that they have a fiduciary duty to U.S. citizens, which they violate if they participate in insider trades. Ethically, this seems to be certainly true. But legally, Bainbridge thinks it’s a little more murky. He believes that members of Congress are effectively fiduciaries of no one. “There’s at least a strong argument,” he says, “that congressional insider trading is not illegal under current law.” Certainly, the guardians of our laws don’t seem eager to pursue the question. No member of Congress has ever been investigated for insider trading. Four times since 2006, Congresswoman Louise Slaughter (D–New York) has sponsored the STOCK Act, which would explicitly make congressional insider trading illegal, and require members of Congress to disclose significant trades within 90 days. It’s never even come to a vote.
‘Enforcement 40’ for 2020
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