I 

110TH CONGRESS 

1ST SESSION H. R. 2341 

To prohibit securities and commodities trading based on nonpublic information 

relating to Congress, and to require additional reporting by Members 

and employees of Congress of securities transaction, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

MAY 16, 2007 

Mr. BAIRD (for himself and Ms. SLAUGHTER) introduced the following bill; 

which was referred to the Committee on Financial Services, and in addition to the Committees on House Administration, Judiciary, Agriculture, 

and Standards of Official Conduct, 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 securities and commodities trading based on nonpublic information relating to Congress, and to require 

additional reporting by Members and employees of Congress of securities transaction, 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, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Stop Trading on Con5 gressional Knowledge Act’’. 


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1 SEC. 2. NONPUBLIC INFORMATION RELATING TO CON2 GRESS. 

3 (a) SECURITIES TRANSACTIONS.—Section 10 of the 

4 Securities Exchange Act of 1934 is amended by adding 

5 at the end the following: 

6 ‘‘(c) NONPUBLIC INFORMATION RELATING TO CON7 GRESS.—Not later than 270 days after the date of enact8 ment of this subsection, the Commission shall by rule pro9 hibit any person from buying or selling the securities of 

10 any issuer while such person is in possession of material 

11 nonpublic information, as defined by the Commission, re12 lating to any pending or prospective legislative action re13 lating to such issuer if— 

14 ‘‘(1) such information was obtained by reason 

15 of such person being a Member or employee of Con16 gress; or 

17 ‘‘(2) such information was obtained from a 

18 Member or employee of Congress, and such person 

19 knows that the information was so obtained. 

20 ‘‘(d) NONPUBLIC INFORMATION RELATING TO

21 OTHER FEDERAL EMPLOYEES.— 

22 ‘‘(1) RULEMAKING.—Not later than 270 days 

23 after the date of enactment of this subsection, the 

24 Commission shall by rule prohibit any person from 

25 buying or selling the securities of any issuer while 

26 such person is in possession of material nonpublic 


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1 information derived from Federal employment and 

2 relating to such issuer if— 

3 ‘‘(A) such information was obtained by 

4 reason of such person being an employee of an 

5 agency, as such term is defined in section 

6 551(1) of title 5, United States Code; or 

7 ‘‘(B) such information was obtained from 

8 such an employee, and such person knows that 

9 the information was so obtained. 

10 ‘‘(2) MATERIAL NONPUBLIC INFORMATION.— 

11 For purposes of this subsection, the term ‘material 

12 nonpublic information’ means any information that 

13 an employee of an agency (as such term is defined 

14 in section 551(1) of title 5, United States Code) 

15 gains by reason of Federal employment and that 

16 such employee knows or should know has not been 

17 made available to the general public, including infor18 mation that— 

19 ‘‘(A) is routinely exempt from disclosure 

20 under section 552 of title 5, United States 

21 Code, or otherwise protected from disclosure by 

22 statute, Executive order, or regulation; 

23 ‘‘(B) is designated as confidential by an 

24 agency; or 


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1 ‘‘(C) has not actually been disseminated to 

2 the general public and is not authorized to be 

3 made available to the public on request.’’. 

4 (b) COMMODITIES TRANSACTIONS.—Section 4c of the 

5 Commodities Exchange Act (7 U.S.C. 6c) is amended by 

6 adding at the end the following: 

7 ‘‘(h) NONPUBLIC INFORMATION RELATING TO CON8 GRESS.—Not later than 270 days after the date of enact9 ment of this subsection, the Commission shall by rule pro10 hibit any person from buying or selling any commodity 

11 for future delivery while such person is in possession of 

12 material nonpublic information, as defined by the Com13 mission, relating to any pending or prospective legislative 

14 action relating to such commodity if— 

15 ‘‘(1) such information was obtained by reason 

16 of such person being a Member or employee of Con17 gress; or 

18 ‘‘(2) such information was obtained from a 

19 Member or employee of Congress, and such person 

20 knows that the information was so obtained. 

21 ‘‘(i) NONPUBLIC INFORMATION RELATING TO OTHER

22 FEDERAL EMPLOYEES.— 

23 ‘‘(1) RULEMAKING.—Not later than 270 days 

24 after the date of enactment of this subsection, the 

25 Commission shall by rule prohibit any person from 


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1 buying or selling any commodity for future delivery 

2 while such person is in possession of material non3 public information derived from Federal employment 

4 and relating to such commodity if— 

5 ‘‘(A) such information was obtained by 

6 reason of such person being an employee of an 

7 agency, as such term is defined in section 

8 551(1) of title 5, United States Code; or 

9 ‘‘(B) such information was obtained from 

10 such an employee, and such person knows that 

11 the information was so obtained. 

12 ‘‘(2) MATERIAL NONPUBLIC INFORMATION.— 

13 For purposes of this subsection, the term ‘material 

14 nonpublic information’ means any information that 

15 an employee of an agency (as such term is defined 

16 in section 551(1) of title 5, United States Code) 

17 gains by reason of Federal employment and that 

18 such employee knows or should know has not been 

19 made available to the general public, including infor20 mation that— 

21 ‘‘(A) is routinely exempt from disclosure 

22 under section 552 of title 5, United States 

23 Code, or otherwise protected from disclosure by 

24 statute, Executive order, or regulation; 


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1 ‘‘(B) is designated as confidential by an 

2 agency; or 

3 ‘‘(C) has not actually been disseminated to 

4 the general public and is not authorized to be 

5 made available to the public on request.’’. 

6 SEC. 3. AMENDMENT TO THE RULES OF THE HOUSE OF 

7 REPRESENTATIVES REGARDING SECURITIES 

8 TRADING BASED ON NONPUBLIC INFORMA9 TION. 

10 Rule XXIII (known as the ‘‘Code of Official Con11 duct’’) of the Rules of the House of Representatives is 

12 amended by redesignating clause 18 as clause 19 and by 

13 inserting after clause 17 the following new clause: 

14 ‘‘18. A Member, Delegate, Resident Commis15 sioner, officer, or employee of the House shall not— 

16 ‘‘(a) disclose material nonpublic informa17 tion relating to any pending or prospective leg18 islative action relating to any publicly-traded 

19 company if that Member, Delegate, Resident 

20 Commissioner, officer, or employee has reason 

21 to believe that the information will be used to 

22 buy or sell the securities of such publicly-traded 

23 company based on such information; or 

24 ‘‘(b) disclose material nonpublic informa25 tion relating to any pending or prospective legVerDate Aug 31 2005 04:36 May 18, 2007 Jkt 059200 PO 00000 Frm 00006 Fmt 6652 Sfmt 6201 E:\BILLS\H2341.IH H2341

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1 islative action relating to any commodity if that 

2 Member, Delegate, Resident Commissioner, offi3 cer, or employee has reason to believe that the 

4 information will be used to buy or sell such 

5 commodity for future delivery based on such in6 formation.’’. 

7 SEC. 4. TIMELY REPORTING OF SECURITIES TRANS8 ACTIONS. 

9 (a) AMENDMENT.—Section 103 of the Ethics in Gov10 ernment Act of 1978 is amended by adding at the end 

11 the following subsection: 

12 ‘‘(l) Within 90 days after the purchase, sale, or ex13 change of any stocks, bonds, commodities futures, or other 

14 forms of securities that are otherwise required to be re15 ported under this Act and the transaction of which in16 volves at least $1000 by any Member of Congress or offi17 cer or employee of the legislative branch required to so 

18 file, that Member, officer, or employee shall file a report 

19 of that transaction with the Clerk of the House of Rep20 resentatives in the case of a Representative in Congress, 

21 a Delegate to Congress, or the Resident Commissioner 

22 from Puerto Rico, or with the Secretary of the Senate in 

23 the case of a Senator.’’. 

24 (b) EFFECTIVE DATE.—The amendment made by 

25 subsection (a) shall apply to transactions occurring on or 


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1 after the date that is 90 days after the date of the enact2 ment of this Act. 

3 SEC. 5. REGISTRATION OF POLITICAL INTELLIGENCE 

4 FIRMS. 

5 (a) DEFINITIONS.—Section 3 of the Lobbying Disclo6 sure Act of 1995 (2 U.S.C. 1602) is amended— 

7 (1) in paragraph (2)— 

8 (A) by inserting after ‘‘lobbying activities’’ 

9 both places such term appears the following: 

10 ‘‘or political intelligence activities’’; and 

11 (B) by inserting after ‘‘lobbyists’’ the fol12 lowing: ‘‘or political intelligence consultants’’; 

13 and 

14 (2) by adding at the end the following new 

15 paragraphs: 

16 ‘‘(17) POLITICAL INTELLIGENCE ACTIVITIES.— 

17 The term ‘political intelligence activities’ means po18 litical intelligence contacts and efforts in support of 

19 such contacts, including preparation and planning 

20 activities, research and other background work that 

21 is intended, at the time it is performed, for use in 

22 contacts, and coordination with the political intel23 ligence activities of others. 

24 ‘‘(18) POLITICAL INTELLIGENCE CONTACT.— 


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1 ‘‘(A) DEFINITION.—The term ‘political in2 telligence contact’ means any oral or written 

3 communication (including an electronic commu4 nication) to or from a covered executive branch 

5 official or a covered legislative branch official, 

6 the information derived from which is intended 

7 for use in analyzing securities or commodities 

8 markets, that is made on behalf of a client with 

9 regard to— 

10 ‘‘(i) the formulation, modification, or 

11 adoption of Federal legislation (including 

12 legislative proposals); 

13 ‘‘(ii) the formulation, modification, or 

14 adoption of a Federal rule, regulation, Ex15 ecutive order, or any other program, policy, 

16 or position of the United States Govern17 ment; or 

18 ‘‘(iii) the administration or execution 

19 of a Federal program or policy (including 

20 the negotiation, award, or administration 

21 of a Federal contract, grant, loan, permit, 

22 or license). 

23 ‘‘(B) EXCEPTION.—The term ‘political in24 telligence contact’ does not include a commu25 nication that is made by or to a representative 


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1 of a media organization if the purpose of the 

2 communication is gathering and disseminating 

3 news and information to the public. 

4 ‘‘(19) POLITICAL INTELLIGENCE FIRM.—The 

5 term ‘political intelligence firm’ means a person or 

6 entity that has 1 or more employees who are polit7 ical intelligence consultants to a client other than 

8 that person or entity. 

9 ‘‘(20) POLITICAL INTELLIGENCE CONSULT10 ANT.—The term ‘political intelligence consultant’ 

11 means any individual who is employed or retained by 

12 a client for financial or other compensation for serv13 ices that include one or more political intelligence 

14 contacts.’’. 

15 (b) REGISTRATION REQUIREMENT.—Section 4 of 

16 that Act (2 U.S.C. 1603) is amended— 

17 (1) in subsection (a)(1)— 

18 (A) by inserting after ‘‘whichever is ear19 lier,’’ the following: ‘‘or a political intelligence 

20 consultant first makes a political intelligence 

21 contact,’’; and 

22 (B) by inserting after ‘‘such lobbyist’’ both 

23 places such term appears the following: ‘‘or con24 sultant’’; 


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1 (2) in subsection (a)(2), by inserting after ‘‘lob2 byists’’ both places such term appears the following: 

3 ‘‘or consultants’’; 

4 (3) in subsection (a)(3)(A)— 

5 (A) by inserting after ‘‘lobbying activities’’ 

6 each place such term appears the following: 

7 ‘‘and political intelligence activities’’; and 

8 (B) in clause (i), by inserting after ‘‘lob9 bying firm’’ the following: ‘‘or political intel10 ligence firm’’; 

11 (4) in subsection (b)(3), by inserting after ‘‘lob12 bying activities’’ both places such term appears the 

13 following: ‘‘or political intelligence activities’’; 

14 (5) in subsection (b)(4), by inserting after ‘‘lob15 bying activities’’ the following: ‘‘or political intel16 ligence activities’’; 

17 (6) in subsection (b)(4)(C), by inserting after 

18 ‘‘lobbying activity’’ the following: ‘‘or political intel19 ligence activity’’; 

20 (7) in subsection (b)(5), by inserting after ‘‘lob21 bying activities’’ both places such term appears the 

22 following: ‘‘or political intelligence activities’’; 

23 (8) in subsection (b)(6), by inserting after ‘‘lob24 byist’’ both places such term appears the following: 

25 ‘‘or political intelligence consultant’’; 


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1 (9) in subsection (c)(1), by inserting after ‘‘lob2 bying contacts’’ the following: ‘‘or political intel3 ligence contacts’’; 

4 (10) in subsection (c)(2)— 

5 (A) by inserting after ‘‘lobbying contact’’ 

6 the following: ‘‘or political intelligence contact’’; 

7 and 

8 (B) by inserting after ‘‘lobbying contacts’’ 

9 the following: ‘‘and political intelligence con10 tacts’’; and 

11 (11) in subsection (d)(1), by inserting after 

12 ‘‘lobbying activities’’ both places such term appears 

13 the following: ‘‘or political intelligence activities’’. 

14 (c) REPORTS BY REGISTERED POLITICAL INTEL15 LIGENCE CONSULTANTS.—Section 5 of the Lobbying Dis16 closure Act of 1995 (2 U.S.C. 1604) is amended— 

17 (1) in subsection (a), by inserting after ‘‘lob18 bying activities’’ the following: ‘‘and political intel19 ligence activities’’; 

20 (2) in subsection (b)(2)— 

21 (A) in the matter preceding subparagraph 

22 (A), by inserting after ‘‘lobbying activities’’ the 

23 following: ‘‘or political intelligence activities’’; 

24 (B) in subparagraph (A)— 


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1 (i) by inserting after ‘‘lobbyist’’ the 

2 following: ‘‘or political intelligence consult3 ant’’; and 

4 (ii) by inserting after ‘‘lobbying activi5 ties’’ the following: ‘‘or political intelligence 

6 activities’’; 

7 (C) in subparagraph (B), by inserting after 

8 ‘‘lobbyists’’ the following: ‘‘or political intel9 ligence consultants’’; and 

10 (D) in subparagraph (C), by inserting 

11 after ‘‘lobbyists’’ the following: ‘‘or political in12 telligence consultants’’; 

13 (3) in subsection (b)(3)— 

14 (A) by inserting after ‘‘lobbying firm’’ the 

15 following: ‘‘or political intelligence firm’’; and 

16 (B) by inserting after ‘‘lobbying activities’’ 

17 both places such term appears the following: 

18 ‘‘or political intelligence activities’’; and 

19 (4) in subsection (b)(4), by inserting after ‘‘lob20 bying activities’’ both places such term appears the 

21 following: ‘‘or political intelligence activities’’. 

22 (d) DISCLOSURE AND ENFORCEMENT.—Section 6 of 

23 the Lobbying Disclosure Act of 1995 (2 U.S.C. 1605) is 

24 amended— 


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1 (1) in paragraph (3)(A), by inserting after ‘‘lob2 bying firms’’ the following: ‘‘, political intelligence 

3 consultants, political intelligence firms,’’; 

4 (2) in paragraph (7), by inserting after ‘‘lob5 bying firm’’ the following: ‘‘, or political intelligence 

6 consultant or political intelligence firm,’’; and 

7 (3) in paragraph (8), by inserting after ‘‘lob8 bying firm’’ the following: ‘‘, or political intelligence 

9 consultant or political intelligence firm,’’. 

10 (e) RULES OF CONSTRUCTION.—Section 8 of the 

11 Lobbying Disclosure Act of 1995 (2 U.S.C. 1607) is 

12 amended in subsection (b) by inserting after ‘‘lobbying 

13 contacts’’ the following: ‘‘, or political intelligence activi14 ties or political intelligence contacts,’’. 

Æ 


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