STOCK Act 2.0

Bill: 117-s-3612
Sponsor: full_name: Sen. Gillibrand, Kirsten E. [D-NY]
Introduced: 2022-02-09
Policy area: Congress
Latest action: action_date: 2022-02-09
text: Read twice and referred to the Committee on Homeland Security and Governmental Affairs.

Summaries:
action_date: 2022-02-09
action_desc: Introduced in Senate
text: <p><strong>STOCK Act 2.0</strong></p> <p>This bill expands restrictions on investment practices and requirements for financial disclosures that apply to specified high-level government officials.</p> <p>In particular, the bill bars individual stock trading by (1) Members of Congress, (2) the President and Vice President, (3) Supreme Court Justices, (4) governors of the Federal Reserve Board, and (5) presidents and vice presidents of Federal Reserve banks.</p> <p>Additionally, the bill requires financial disclosures to include loans, contracts, and other benefits (excluding salaries, compensation, or tax refunds) from the federal government. It also requires additional officials, namely judges and senior leaders of Federal Reserve banks, to make the disclosures.</p> <p>Further, the bill directs supervising ethics agencies to make the disclosures publicly available in formats that are easily searchable, sortable, and downloadable.</p>

tv_txt: II 117th CONGRESS 2d Session S. 3612 IN THE SENATE OF THE UNITED STATES February 9, 2022 Mrs. Gillibrand introduced the following bill; which was read twice and referred to the Committee on Homeland Security and Governmental Affairs A BILL To amend the Ethics in Government Act of 1978 and the STOCK Act to require certain senior officials to report payments received from the Federal Government, to improve the filing and disclosure of financial disclosures by Members of Congress, congressional staff, very senior employees, and others, and to ban stock trading for certain senior Government officials, and for other purposes.

1. Short title This Act may be cited as the STOCK Act 2.0 . 2. Reporting of applications for, or receipt of, payments from Federal Government (a) In general Section 101 of the Ethics in Government Act of 1978 (5 U.S.C. App.) is amended by adding at the end the following: (j) Reporting of applications for, or receipt of, payments from Federal Government (1) Definitions In this subsection: (A) Covered payment (i) In general The term covered payment means a payment of money or any other item of value made, or promised to be made, by the Federal Government. (ii) Inclusions The term covered payment includes— (I) a loan agreement, contract, or grant made, or promised to be made, by the Federal Government, including such an agreement, contract, or grant relating to agricultural activity; and (II) such other types of payment of money or items of value as the Secretary of the Treasury, in consultation with the Director of the Office of Government Ethics, may establish, by regulation. (iii) Exclusions The term covered payment does not include— (I) any salary or compensation for service performed as, or reimbursement of personal outlay by, an officer or employee of the Federal Government; or (II) any tax refund (including a refundable tax credit). (B) Covered person The term covered person means a person described in any of paragraphs (1) through (10) of section 103( l ). (2) Reporting requirement Not later than 30 days after the date of receipt of a notice of any application for, or receipt of, a covered payment by a covered person, the spouse of the covered person, or a dependent child of the covered person (including any business owned and controlled by the covered person or spouse or dependent child of the covered person), but in no case later than 45 days after the date on which the covered payment is made or promised to be made, the covered person shall submit to the applicable supervising ethics office a report describing the covered payment. (3) Fine for failure to report Notwithstanding section 104(d), a covered person shall be assessed a fine, pursuant to regulations issued by the applicable supervising ethics office, of $500 in each case in which the covered person fails to file a report required under this subsection. . (b) Report contents Section 102 of the Ethics in Government Act of 1978 (5 U.S.C. App.) is amended by adding at the end the following: (j) Payments from Federal Government Each report filed pursuant to subsection (j) of section 101 shall include— (1) an identification of each type of payment or item of value applied for, or received, from the Federal Government; (2) (A) the name of each recipient of each payment or item of value identified under paragraph (1); and (B) the relationship of each recipient named under subparagraph (A) to the person filing the report; (3) a description of the date on which, as applicable— (A) an application for a payment or other item of value was submitted to the Federal Government; and (B) the payment or item of value was received from the Federal Government; and (4) a description of the amount of each applicable payment or item of value. . (c) Technical and conforming amendments (1) Section 101 of the Ethics in Government Act of 1978 (5 U.S.C. App.) is amended— (A) in subsection (f)— (i) in paragraph (9), by striking as defined under section 109(12) ; (ii) in paragraph (10), by striking as defined under section 109(13) ; (iii) in paragraph (11), by striking as defined under section 109(10) ; and (iv) in paragraph (12), by striking as defined under section 109(8) ; (B) in subsection (h)(1), by striking , and at the end and inserting ; and ; and (C) in subsection (i)— (i) in each of paragraphs (1) and (2), by striking the comma at the end of the paragraph and inserting a semicolon; and (ii) in paragraph (3), by striking , and at the end and inserting ; and . (2) Section 102 of the Ethics in Government Act of 1978 (5 U.S.C. App.) is amended— (A) in subsection (a)— (i) in the matter preceding paragraph (1), by striking section 101(d) and (e) and inserting subsection (d) or (e) of section 101 ; (ii) in paragraph (1)(B)— (I) in the matter preceding clause (i), by striking within: and inserting within— ; (II) in each of clauses (i) through (vii), by striking the comma at the end of the clause and inserting a semicolon; and (III) in clause (viii), by striking , or at the end and inserting ; or ; and (iii) in paragraph (3), in the first sentence, by striking spouse,, and inserting spouse, ; (B) in subsection (d)(1)— (i) in the matter preceding subparagraph (A), by striking are as follows: and inserting are— ; and (ii) by indenting subparagraphs (G) through (J) appropriately; and (C) in subsection (e)(1), by indenting subparagraph (F) appropriately. (d) Effective date The amendments made by this section shall apply to relevant applications submitted to, and payments made or promised to be made by, the Federal Government on or after the date that is 90 days after the date of enactment of this Act. 3. Inclusion of Federal Reserve officials and judges (a) In general Notwithstanding any other provision of law, each provision of law described in subsection (b) shall apply to— (1) each president, vice president, and director of a Federal Reserve bank; and (2) each judicial officer (as defined in section 109 of the Ethics in Government Act of 1978 (5 U.S.C. App.)). (b) Description of provisions of law The provisions of law referred to in subsection (a) are— (1) title I of the Ethics in Government Act of 1978 (5 U.S.C. App.); (2) the STOCK Act ( Public Law 112–105 ; 126 Stat. 291; 126 Stat. 1310; 127 Stat. 438; 132 Stat. 4167); and (3) subsections (h) and (i) of section 21A of the Securities Exchange Act of 1934 ( 15 U.S.C. 78u–1 ). (c) Supervising ethics office For purposes of this section and the provisions of law described in subsection (b), the supervising ethics office for a president, vice president, or director of a Federal Reserve bank shall be the Inspector General of the Board of Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection. 4. Penalty for STOCK Act noncompliance (a) In general The STOCK Act ( Public Law 112–105 ; 126 Stat. 291; 126 Stat. 1310; 127 Stat. 438; 132 Stat. 4167) is amended by adding at the end the following: 20. Fines for failure to report (a) In general Notwithstanding any other provision of law (including regulations), an individual shall be assessed a fine, pursuant to regulations issued by the applicable supervising ethics office (including the Administrative Office of the United States Courts, as applicable), of $500 in each case in which the individual fails to file a transaction report required under this Act. (b) Deposit in Treasury The fines paid under this section shall be deposited in the miscellaneous receipts of the Treasury. . (b) Rules, regulations, guidance, and documents Not later than 1 year after the date of enactment of this Act, each supervising ethics office (as defined in section 2 of the STOCK Act (5 U.S.C. App. 101 note)) (including the Administrative Office of the United States Courts, as applicable) shall amend the rules, regulations, guidance, documents, papers, and other records of the supervising ethics office in accordance with the amendment made by this section. 5. Banning conflicted trades (a) In general The Ethics in Government Act of 1978 (5 U.S.C. App.) is amended by inserting after title I the following: II Banning conflicted trades 201. Definitions In this title: (1) Commodity The term commodity has the meaning given the term in section 1a of the Commodity Exchange Act ( 7 U.S.C. 1a ). (2) Covered investment (A) In general The term covered investment means— (i) any investment in— (I) a security; (II) a commodity; (III) a future; or (IV) cryptocurrency, such as a coin or token— (aa) received in connection with an initial coin offering; or (bb) issued or distributed using distributed ledger or blockchain technology; and (ii) any economic interest comparable to an interest described in clause (i) that is acquired through synthetic means, such as the use of a derivative. (B) Exclusions The term covered investment does not include— (i) a widely held investment fund described in section 102(f)(8); or (ii) a United States Treasury bill, note, or bond. (3) Covered person The term covered person means— (A) a Member of Congress (as defined in section 109); (B) the President; (C) the Vice President; (D) the Chief Justice of the United States; (E) an Associate Justice of the Supreme Court; (F) a member of the Board of Governors of the Federal Reserve System; and (G) a president or vice president of a Federal Reserve bank. (4) Future The term future means a financial contract obligating a buyer to purchase, or a seller to sell, an asset, such as a physical commodity or a financial instrument, at a predetermined future date and price. (5) Security The term security has the meaning given the term in section 3(a) of the Securities Exchange Act of 1934 ( 15 U.S.C. 78c(a) ). (6) Supervising ethics office The term supervising ethics office , with respect to a covered person, has the meaning given the term in section 109 with respect to that covered person. 202. Prohibitions (a) Transactions Except as provided in sections 203 and 204, no covered person may— (1) purchase or sell any covered investment; or (2) enter into a transaction that creates a net short position in any security. (b) Positions A covered person may not serve as an officer or member of any board of any for-profit association, corporation, or other entity. 203. Exceptions (a) Investments held before taking office (1) In general A covered person may have control over or knowledge of the management of any covered investment held by the covered person as of the day before the date on which the covered person assumes the applicable office or employment as a covered person. (2) Prohibition on purchasing or selling A covered person may not buy or sell any investment described in paragraph (1), except in the case of— (A) placing the investment in a qualified blind trust described in section 204; or (B) divesting the investment under subsection (b). (b) Divestiture A covered person may sell a covered investment during the 180-day period beginning on the later of— (1) the date on which the covered person assumes office or employment as a covered person; and (2) the date of enactment of the STOCK Act 2.0 . 204. Trusts (a) In general On a case-by-case basis, the applicable supervising ethics office may authorize a covered person to place any security holding of the covered person in a qualified blind trust approved by the supervising ethics office under section 102(f). (b) Blind trust A qualified blind trust permitted under this section shall meet the applicable criteria described in section 102(f)(4)(B), unless an alternative arrangement is approved by the applicable supervising ethics office. 205. Administration and enforcement (a) Administration Each supervising ethics office may issue guidance relating to any matter covered by this title, including— (1) whether a covered person may hold an employee stock option or other, similar instrument that has not vested before the date on which the covered person assumes office or employment as a covered person; and (2) the process and timeline for determining the date on which a covered person shall no longer serve as an officer or member of any board of any for-profit association, corporation, or other entity. (b) Enforcement A covered person who knowingly fails to comply with this title shall be subject to a civil penalty of not less than 10 percent of the value of the covered investment that was purchased or sold, or the security in which a net short position was created, in violation of this title, as applicable. . (b) Conforming amendments (1) Section 103(j)(1) of the Ethics in Government Act of 1978 (5 U.S.C. App.) is amended by striking Standards of Official Conduct and inserting Ethics . (2) Section 105(b)(3)(A) of the Ethics in Government Act of 1978 (5 U.S.C. App.) is amended by striking described in section 109(8) or 109(10) of this Act and inserting who is a judicial employee or judicial officer . (3) Section 109 of the Ethics in Government Act of 1978 (5 U.S.C. App.) is amended— (A) in the matter preceding paragraph (1), by striking For the purposes of this title, the term— and inserting In this title: ; (B) in each of paragraphs (1) through (19)— (i) by inserting The term after the paragraph designation; and (ii) by inserting a paragraph heading, the text of which is comprised of the term defined in that paragraph; (C) in each of paragraphs (2) through (17), by striking the semicolon at the end of the paragraph and inserting a period; (D) in paragraph (1), by striking means and all that follows through Official Conduct and inserting the following: means, as applicable— (A) the Select Committee on Ethics of the Senate; and (B) the Committee on Ethics ; (E) by redesignating paragraphs (8) and (9) as paragraphs (9) and (8), respectively, and moving the paragraphs so as to appear in numerical order; and (F) in paragraph (18)— (i) in subparagraph (B), by striking Standards of Official Conduct and inserting Ethics ; and (ii) in subparagraph (D), by striking ; and at the end and inserting a period. (4) Section 111(2) of the Ethics in Government Act of 1978 (5 U.S.C. App.) is amended by striking Standards of Official Conduct and inserting Ethics . (5) Section 402 of the Ethics in Government Act of 1978 (5 U.S.C. App.) is amended— (A) in subsection (b), by striking title II of each place it appears; and (B) in subsection (f)(2)(B)— (i) by striking Subject to clause (iv) of this subparagraph, before each place it appears and inserting Before ; and (ii) by striking clause (iv). (6) Section 503(1)(A) of the Ethics in Government Act of 1978 (5 U.S.C. App.) is amended by striking Standards of Official Conduct and inserting Ethics . (7) Section 3(4)(D) of the Lobbying Disclosure Act of 1995 ( 2 U.S.C. 1602(4)(D) ) is amended by striking legislative branch employee serving in a position described under section 109(13) of the Ethics in Government Act of 1978 (5 U.S.C. App.) and inserting officer or employee of the Congress (as defined in section 109 of the Ethics in Government Act of 1978 (5 U.S.C. App.)) . (8) Section 2 of the STOCK Act (5 U.S.C. App. 101 note) is amended— (A) in paragraph (2)(B), by striking (11) each place it appears; (B) in paragraph (4), by striking (10) each place it appears; (C) in paragraph (5), by striking (8) each place it appears; and (D) in paragraph (6), by striking (18) each place it appears. (9) Section 21A of the Securities Exchange Act of 1934 ( 15 U.S.C. 78u–1 ) is amended— (A) in subsection (g)(2)(B)(ii), by striking section 109(11) of the Ethics in Government Act of 1978 ( 5 U.S.C. App. 109(11) ) and inserting section 109 of the Ethics in Government Act of 1978 (5 U.S.C. App.) ; and (B) in subsection (h)(2)— (i) in subparagraph (B), by striking section 109(8) of the Ethics in Government Act of 1978 ( 5 U.S.C. App. 109(8) ) and inserting section 109 of the Ethics in Government Act of 1978 (5 U.S.C. App.) ; and (ii) in subparagraph (C), by striking under section 109(10) of the Ethics in Government Act of 1978 ( 5 U.S.C. App. 109(10) ) and inserting in section 109 of the Ethics in Government Act of 1978 (5 U.S.C. App.) . 6. Electronic filing and online public availability of financial disclosure forms (a) Members of Congress and congressional staff Section 8(b)(1) of the STOCK Act (5 U.S.C. App. 105 note) is amended— (1) in the matter preceding subparagraph (A), by inserting , pursuant to title I of the Ethics in Government Act of 1978 (5 U.S.C. App.), through databases maintained on the official websites of the House of Representatives and the Senate after enable ; (2) in subparagraph (A), by striking reports received by them pursuant to section 103(h)(1)(A) of title I of the Ethics in Government Act of 1978 and inserting each report received under section 103(h)(1)(A) of that Act ; and (3) by striking subparagraph (B) and the undesignated matter following that subparagraph and inserting the following: (B) public access— (i) to each— (I) financial disclosure report filed by a Member of Congress or a candidate for Congress; (II) transaction disclosure report filed by a Member of Congress or a candidate for Congress pursuant to section 103( l ) of that Act; and (III) notice of extension, amendment, or blind trust, with respect to a report described in subclause (I) or (II), pursuant to title I of that Act; and (ii) in a manner that— (I) allows the public to search, sort, and download data contained in the reports described in subclause (I) or (II) of clause (i) by criteria required to be reported, including by filer name, asset, transaction type, ticker symbol, notification date, amount of transaction, and date of transaction; (II) allows access through an application programming interface; and (III) is fully compliant with— (aa) section 508 of the Rehabilitation Act of 1973 ( 29 U.S.C. 794d ); and (bb) the most recent Web Content Accessibility Guidelines (or successor guidelines). . (b) Very senior executive branch employees Section 11(b)(1) of the STOCK Act (5 U.S.C. App. 105 note) is amended— (1) in the matter preceding subparagraph (A), by inserting , pursuant to title I of the Ethics in Government Act of 1978 (5 U.S.C. App.), through databases maintained on the official website of the Office of Government Ethics after enable ; and (2) by striking subparagraph (B) and the undesignated matter following that subparagraph and inserting the following: (B) public access— (i) to each— (I) financial disclosure report filed by— (aa) the President; (bb) the Vice President; or (cc) an officer occupying a position listed in section 5312 or 5313 of title 5, United States Code, having been nominated by the President and confirmed by the Senate to that position; (II) transaction disclosure report filed by an individual described in subclause (I) pursuant to section 103( l ) of the Ethics in Government Act of 1978 (5 U.S.C. App); and (III) notice of extension, amendment, or blind trust, with respect to a report described in subclause (I) or (II), pursuant to title I of that Act; and (ii) in a manner that— (I) allows the public to search, sort, and download data contained in the reports described in subclause (I) or (II) of clause (i) by criteria required to be reported, including by filer name, asset, transaction type, ticker symbol, notification date, amount of transaction, and date of transaction; (II) allows access through an application programming interface; and (III) is fully compliant with— (aa) section 508 of the Rehabilitation Act of 1973 ( 29 U.S.C. 794d ); and (bb) the most recent Web Content Accessibility Guidelines (or successor guidelines). . (c) Judicial officers Section 9 of the STOCK Act ( Public Law 112–105 ; 126 Stat. 297) is amended by adding at the end the following: (c) Judicial officers (1) In general Subject to paragraph (6), not later than 1 year after the date of enactment of this subsection, the Administrative Office of the United States Courts shall develop a system to enable, pursuant to title I of the Ethics in Government Act of 1978 (5 U.S.C. App.), through a database maintained on the official website of the Administrative Office of the United States Courts— (A) electronic filing of reports received from judicial officers pursuant to that title; and (B) public access— (i) to each— (I) financial disclosure report filed by a judicial officer; (II) transaction disclosure report filed by a judicial officer pursuant to section 103( l ) of the Ethics in Government Act of 1978 (5 U.S.C. App); and (III) notice of extension, amendment, or blind trust, with respect to a report described in subclause (I) or (II), pursuant to that title; and (ii) in a manner that— (I) allows the public to search, sort, and download data contained in a report described in clause (i) by criteria required to be reported, including by filer name, asset, transaction type, ticker symbol, notification date, amount of transaction, and date of transaction; (II) allows access through an application programming interface; and (III) is fully compliant with— (aa) section 508 of the Rehabilitation Act of 1973 ( 29 U.S.C. 794d ); and (bb) the most recent Web Content Accessibility Guidelines (or successor guidelines). (2) Login For purposes of filings under paragraph (1)(B), section 105(b)(2) of the Ethics in Government Act of 1978 (5 U.S.C. App.) shall not apply. (3) Public availability The electronic availability of filings under paragraph (1)(B) on the official website of the Administrative Office of the United States Courts shall be deemed to meet the public availability requirement under section 105(b)(1) of the Ethics in Government Act of 1978 (5 U.S.C. App.). (4) Filers covered Each judicial officer who is required under the Ethics in Government Act of 1978 (5 U.S.C. App.) to file a financial disclosure report with a supervising ethics office shall be able to file that report electronically using the applicable system developed under this subsection. (5) Extensions Each notice of an extension for a financial disclosure covered by this subsection shall be made available electronically under paragraph (1)(B), together with any related disclosure. (6) Additional time The requirements of this subsection may be implemented after the date described in paragraph (1) if the Administrative Office of the United States Courts identifies in writing to the relevant congressional committees the additional time needed for that implementation. . (d) Officers of Federal Reserve banks Section 9 of the STOCK Act ( Public Law 112–105 ; 126 Stat. 297) (as amended by subsection (c)) is amended by adding at the end the following: (d) Officers of Federal Reserve banks (1) Definitions In this subsection: (A) Covered person The term covered person means— (i) a president of a Federal Reserve bank; (ii) a vice president of a Federal Reserve bank; and (iii) a director of a Federal Reserve bank. (B) Supervising ethics office The term supervising ethics office means the Inspector General of the Board of Governors of the Federal Reserve System and the Bureau of Consumer Financial Protection. (2) Electronic filing and online public availability of financial disclosure forms (A) In general Subject to subparagraph (F), not later than 1 year after the date of enactment of this subsection, the supervising ethics office shall develop a system to enable, pursuant to title I of the Ethics in Government Act of 1978 (5 U.S.C. App.), through a database maintained on the official website of the supervising ethics office— (i) electronic filing of reports received from covered persons pursuant to that title; and (ii) public access— (I) to each— (aa) financial disclosure report filed by a covered person; (bb) transaction disclosure report filed by a covered person pursuant to section 103( l ) of the Ethics in Government Act of 1978 (5 U.S.C. App); and (cc) notice of extension, amendment, or blind trust, with respect to a report described in item (aa) or (bb), pursuant to that title; and (II) in a manner that— (aa) allows the public to search, sort, and download data contained in a report described in subclause (I) by criteria required to be reported, including by filer name, asset, transaction type, ticker symbol, notification date, amount of transaction, and date of transaction; (bb) allows access through an application programming interface; and (cc) is fully compliant with— (AA) section 508 of the Rehabilitation Act of 1973 ( 29 U.S.C. 794d ); and (BB) the most recent Web Content Accessibility Guidelines (or successor guidelines). (B) Login For purposes of filings under subparagraph (A)(ii), section 105(b)(2) of the Ethics in Government Act of 1978 (5 U.S.C. App.) shall not apply. (C) Public availability The electronic availability of filings under subparagraph (A)(ii) on the official website of a supervising ethics office shall be deemed to meet the public availability requirement under section 105(b)(1) of the Ethics in Government Act of 1978 (5 U.S.C. App.). (D) Filers covered Each covered person who is required under the Ethics in Government Act of 1978 (5 U.S.C. App.) to file a financial disclosure report with a supervising ethics office shall be able to file that report electronically using the applicable system developed under this paragraph. (E) Extensions Each notice of an extension for a financial disclosure covered by this paragraph shall be made available electronically under subparagraph (A)(ii), together with any related disclosure. (F) Additional time The requirements of this paragraph may be implemented after the date described in subparagraph (A) if a supervising ethics office identifies in writing to the relevant congressional committees the additional time needed for that implementation. . (e) Applicability The amendments made by this section shall apply on and after the date that is 18 months after the date of enactment of this Act.