I 

112TH CONGRESS 

2D SESSION H. R. 4009 

To prohibit Members of Congress, senior congressional staffers, and administration executives from making certain purchases or sales of registered 

securities, futures, swaps, security futures products, security-based swaps, 

and options, to prohibit bonus payments to executives at Fannie Mae 

and Freddie Mac, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

FEBRUARY 9, 2012 

Mr. ISSA introduced the following bill; which was referred to the Committee 

on Financial Services, and in addition to the Committees on House Administration and Oversight and Government Reform, for a period to be 

subsequently determined by the Speaker, in each case for consideration 

of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To prohibit Members of Congress, senior congressional staffers, and administration executives from making certain 

purchases or sales of registered securities, futures, swaps, 

security futures products, security-based swaps, and options, to prohibit bonus payments to executives at Fannie 

Mae and Freddie Mac, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 


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1 SECTION 1. LIMITATIONS ON DISCRETION OVER INVEST2 MENTS IN REGISTERED SECURITIES. 

3 (a) IN GENERAL.—Members of Congress, senior con4 gressional staffers, and administration executives are pro5 hibited from the purchase or sale of registered securities, 

6 futures, swaps, security futures products, security-based 

7 swaps, and options on such securities, futures, and swaps, 

8 subject to exceptions for the purchase or sale of— 

9 (1) exchange traded funds, exchange traded 

10 notes, and mutual funds registered with the Securi11 ties and Exchange Commission that contain greater 

12 than 10 single name securities; 

13 (2) commodity-based swaps, futures, exchange 

14 traded funds and exchange traded notes; 

15 (3) security-based swaps or security futures 

16 products whose value is not primarily dependent on 

17 10 or fewer single name securities; 

18 (4) Treasury, State, and municipal securities; 

19 (5) options on any investments described under 

20 paragraphs (1) through (4); and 

21 (6) securities, security-based swaps, and secu22 rity futures products whose value is primarily de23 pendent on 10 or fewer single name securities, or 

24 options on such investments, subject to— 

25 (A) preapproval by the Securities and Ex26 change Commission; 


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1 (B) compliance with a written contract re2 lying on any of the affirmative defenses avail3 able under section 240.10b5–1(c)(1) of title 17, 

4 Code of Federal Regulations, where such writ5 ten contract is executed and delivered to the Se6 curities and Exchange Commission, or its des7 ignated agent, at least 30 days prior to the date 

8 of the first scheduled purchase or sale trans9 action; or 

10 (C) such purchase or sale being made on 

11 behalf of such person by a qualified blind trust 

12 (as defined under section 102(f)(3) of the Eth13 ics in Government Act of 1978), where notice of 

14 the execution of a blind trust agreement is pro15 vided to the Securities and Exchange Commis16 sion, or its designated agent, not later than 3 

17 days after executing such agreement. 

18 (b) PENALTY.—Any person who violates subsection 

19 (a) shall be subject to the provisions of section 240.10b5– 

20 1 of title 17, Code of Federal Regulations, relating to ma21 terial nonpublic information received in the course of em22 ployment. 

23 (c) DEFINITIONS.—For purposes of this section: 

24 (1) ADMINISTRATION EXECUTIVES.—The term 

25 ‘‘administration executive’’ means— 


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1 (A) the President; 

2 (B) the Vice President; 

3 (C) any position in the executive branch 

4 the appointment to which is made by the Presi5 dent and requires advice and consent of the 

6 Senate; or 

7 (D) an officer or employee of the executive 

8 branch, including all Federal agencies, who, for 

9 at least 60 days, occupies a position for which 

10 the rate of basic pay is equal to or greater than 

11 120 percent of the minimum rate of basic pay 

12 payable for GS–15 of the General Schedule. 

13 (2) MEMBER OF CONGRESS.—The term ‘‘Mem14 ber of Congress’’ means a member of the Senate or 

15 House of Representatives, a Delegate to the House 

16 of Representatives, or the Resident Commissioner 

17 from Puerto Rico. 

18 (3) SENIOR CONGRESSIONAL STAFFER.—The 

19 term ‘‘senior congressional staffer’’ means an officer 

20 or employee of the legislative branch who, for at 

21 least 60 days, occupies a position for which the rate 

22 of basic pay is equal to or greater than 120 percent 

23 of the minimum rate of basic pay payable for GS– 

24 15 of the General Schedule. 


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1 (d) EFFECTIVE DATE.—This section shall take effect 

2 after the end of the 270-day period beginning on the date 

3 of the enactment of this Act. 

4 SEC. 2. LIMITATION ON BONUSES TO EXECUTIVES OF 

5 FANNIE MAE AND FREDDIE MAC. 

6 Notwithstanding any other provision in law, senior 

7 executives at the Federal National Mortgage Association 

8 and the Federal Home Loan Mortgage Corporation are 

9 prohibited from receiving bonuses during any period of 

10 conservatorship for those entities on or after the date of 

11 enactment of this Act. 

Æ 


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