Sen. Coburn Opposes Insider Trading Ban

[Dave70968]

http://finance.yahoo.com/news/senate-tighten-ban-insider-trading-233608799.html

Senate to Tighten Ban on Insider Trading by Lawmakers
Derek Wallbank

The Senate voted to bar members of Congress, their staff and most executive branch employees from trading stocks, commodities or futures based on non-public information they learn on the job.

The bill, passed 96-3 today, would require those people and workers in independent federal agencies to report any trades of $1,000 or more within 30 days. The requirement would cover about 300,000 employees, said independent Senator Joe Lieberman of Connecticut. The disclosure requirement wouldn't apply to widely held investment funds.

House Majority Leader Eric Cantor said he will schedule House action next week on the Senate bill.

President Barack Obama welcomed the Senate passage and urged the House to act quickly to send it for his signature. He also called on lawmakers to pass legislation that would prohibit members of Congress from owning stocks in industry affected by their actions and bar political fundraisers from lobbying.

The measure passed today also would would block bonuses for executives of Fannie Mae and Freddie Mac while those agencies remain in government conservatorship.

Though members of Congress aren't exempt from existing federal insider-trading laws, the Constitution's protection of their "speech or debate" may make it hard to investigate potential violations. The measure, S. 2038, would give members and employees a "duty of trust and confidence" to the government for purposes of securities and insider-trading law.

'Send the Message'

"We can send the message to the American people that we're trying to re-establish the trust that seems to have been lost with them," said Massachusetts Republican Scott Brown. "And who knows, maybe we'll be in double figures in terms of the approval rating pretty soon."

A Jan. 22-24 NBC-Wall Street Journal poll of 1,000 adults showed that just 13 percent approved of the job Congress is doing and 80 percent disapproved.

The senators who voted against the measure were Tom Coburn of Oklahoma and Richard Burr of North Carolina, both Republicans, and Jeff Bingaman, a New Mexico Democrat. [emphasis mine]

More than 270 House members, almost 60 percent of the House, signed on to a similar bill, H.R. 1148.

In November, CBS's "60 Minutes" reported that some members of Congress bought stock in companies while legislation that might affect those businesses was being debated. Two Senate bills to tighten rules on such trading were introduced the following week, and they were merged into the measure passed today.
Votes on Amendments

The vote followed hours of debate on nearly two dozen amendments, including several unrelated to insider trading. Senator Richard Shelby, an Alabama Republican, sponsored the amendment that broadened the measure to cover executive branch and independent agency employees.

The Senate rejected proposed amendments to permanently ban members of Congress from adding funds for pet projects in their home districts into legislation, known as earmarking.

Robert Khuzami, director of the Securities and Exchange Commission's enforcement division, said in December that while federal law is clear that congressional staff aides are covered by the same insider-trading prohibitions as other federal workers, members of Congress present a "more novel" question.

They are protected by the Constitution from many forms of prosecution relating to the legislative process, which could complicate investigations into potential insider-trading, Khuzami said at a Dec. 6 House Financial Services Committee hearing.

Am I crazy, or didn't Sen. Coburn run on a Washington-outsider, end the corruption platform? Guess he wasn't serious about it.

 

[flatwins]

Hmmm. Interesting.

 

[bulbboy]

His words:

“I stand in opposition to this bill, not because I think we should have insider trading. As a physician, I am trained to fix the real problem and you're treating the symptoms. You know, several months ago, CBS did a series and showed some questionable but not necessarily insider trading stock trades which brought about, given our low level of confidence by the American public in this institution, has raised the question well, what about insider trading?”

“You know, I honestly believe everyone in our body is never going to use insider trading to advantage themselves over the best interests of the country, but the real problem is the confidence in the congress to do what is in the best long-term interest of the country, and the reason that the confidence isn't there doesn't have anything to do with insider trading, as we would normally think about it”

“Our system of law is built on the fact that we're innocent until we're proven guilty. And the assumption that the senate is undertaking now is that some of our colleagues are doing insider trading on the stock market”

On amendment 1473 (Requires all legislation to be reviewed before it is considered by the Senate to determine whether new duplicative and overlapping programs are being created):

“What this amendment says is every bill that comes before congress to be considered by the senate, we should determine whether it's duplicating something that's already happening in the federal government. It's common sense…The Congressional Research Service should be able to determine if the bill creates a new federal program, office, or initiative that would duplicate or overlap any existing federal program, any existing federal office or initiative with a similar mission, similar purpose, similar goal”

On Amendment 1474 (Requiring all legislation to be posted online at least 72 hour prior to a vote):

“What this amendment says is that before we vote on a bill, we're going to have at least 72 hours to read it. It just says it has to be online for 72 hours, in other words, we get the privilege of reading the bills we're voting on. And we also get the privilege of knowing the financial cost of the bills or at least an estimate of the financial cost that they will entail. This transparency is designed to make the senate better. You want a bill -- to build confidence with the American public? Then the way you build confidence is assure them that you knew exactly what you were doing when you cast a vote”

On amendment 1476 (Substitute to the STOCK Act):

“This amendment would provide a complete substitute for the STOCK Act. It requires members and staff to certify that they have not used inside information for private financial profit. In other words, they're going to make an affirmative statement under the law that they have not violated section 10-b of the Securities and Exchange Act"

“The STOCK Act does not create new restrictions for congress against insider trading. We all know that. Those restrictions are there. We don't change the restrictions at all. The SEC has stated that the members of Congress and staff are already subject to insider trading laws. In fact, all Americans are subject to these laws including the senate, found primarily in section 10-b. This provision restricts anyone who trades stocks from using material nonpublic information to profit financially and Congress is no different than anybody else. The STOCK act was carefully written to apply simply reaffirm that Congress is not exempted. From these laws and I believe the Chairman stated that just a moment ago which we would include in this. As such, the bill brings new reforms to the table, nor does it create any real expectation that behavior will change. it just requires a paperwork filing"

“Nobody in this chamber can name somebody right now who's trading on inside information. And yet we're changing the law not because anybody has done something wrong but because we're struggling to try to get people to think that we're doing things right. And there is nothing wrong with that as long as we're not going to entrap members of our colleagues"

- Dr. Coburn

 

[doctorjj]

Pisspoor reasoning Dr. Coburn. Meanwhile laws have been passed so that I can't even get a pen from a drug company anymore. Those laws were probably conceived by members of congress while on a lavish trip or dinner paid for by a lobbyist.

 

[VitruvianDoc]

The the insider stock trade is just like the revolving door of corporate america with senators/congressmen becoming lobbyists, etc.

They can create all the regulations they want but those creating them are intent on leaving a back door to keep the money flowing.

 

[HMFIC]

I'm not pleased with Coburns attitude and words about the insider trading potential. I'll be calling his office again today I guess...

I guess it's time to do some research... supposedly they have studies showing how much members of Congress have increased their wealth through trading far and above the norm. I'd like to see something from the SEC.

 

[ronny]

Coburn is one of those Senators who actually studies Bills that come before him (or members of his staff do).

I think his last paragraph was right on.

Way too many Bills are passed in Congress which are designed primarily to placate the Public.

 

[BadgeBunny]

My gosh, he sounds just like a politician ... sheesh ...

 

[flatwins]

I've reached the point where I'm ready to vote 'em all out. I strongly support term limits on the Senate and Congress.

 

[ronny]

Coburn has term-limited himself out after this term. I suspect we'll all regret it.