RELEASE: Cloud Introduces Bipartisan Bill to Ban Stock Trading by Senior Federal Government Officials

WASHINGTON—Congressman Michael Cloud (R-TX) and Congressman Jared Golden (D-ME) introduced the Dismantling Investments in Violation of Ethical Standards through Trusts (DIVEST) Act, a bipartisan effort to prohibit senior federal government employees and their immediate families from trading individual stocks while serving in government.

The DIVEST Act would bar Senior Executive Service (SES) employees and their spouses from holding or trading individual stocks while serving in the Executive Branch.

Public confidence in government has plummeted, in part because unelected federal officials—who wield enormous influence over regulations, industries, and economic policy—have been exposed for profiting off their positions. An investigative report from the Wall Steet Journal revealed that thousands of high-ranking career officials owned or traded stocks in companies directly affected by their agencies’ decisions.

• While the government was ramping up scrutiny of big technology companies, more than 1,800 federal officials reported owning or trading at least one of four major tech stocks: Meta Platforms Inc.’s Facebook, Alphabet Inc.’s Google, Apple Inc. and Amazon.com Inc. 
• More than 200 senior EPA officials, nearly one in three, reported investments in companies that were lobbying the agency. EPA employees and their family members collectively owned between $400,000 and nearly $2 million in shares of oil and gas companies on average each year between 2016 and 2021.
• When financial holdings caused a conflict, the agencies sometimes simply waived the rules. In most instances identified by the Journal, ethics officials certified that the employees had complied with the rules, which have several exemptions that allow officials to hold stock that conflicts with their agency’s work.

One of the most well-known examples of a Senior Executive Service (SES) is Dr. Anthony Fauci, who would have been subject to this bill’s restrictions. As director of the National Institute of Allergy and Infectious Diseases, Fauci held a position that was nearly impossible to remove him from, and his agency’s actions had sweeping consequences on pharmaceutical companies and public health policy.

One of the most well-known examples is Dr. Anthony Fauci, who, as a member of the Senior Executive Service (SES), would have been subject to this bill’s restrictions. As director of the National Institute of Allergy and Infectious Diseases, Fauci held a position that was nearly impossible to remove him from, and his agency’s actions had sweeping consequences on pharmaceutical companies and public health policy.

“Public servants should serve the people—not their stock portfolios,” stated Congressman Cloud. “Americans deserve to know that the officials regulating industries and setting policies aren’t making decisions based on personal financial gain. While Congress debates limits on stock trading for its own members—a move I fully support—we cannot ignore the unelected bureaucrats who wield enormous influence over America’s industries, regulations, and economic policy. DOGE has helped expose that too many career officials in Washington believe they are free to operate without oversight. This is a common-sense issue that the American people overwhelmingly support—government should be transparent, accountable, and free from corruption. If someone wants to serve in government, their focus should be on serving the American people, not themselves.”

“Public service means putting the common good before personal gain. Senior executive officials have access to information that most Americans do not. Trading on that information is wrong, and even the appearance of insider trading undermines peoples’ faith that their government actually works for them,” stated Congressman Golden. “While we continue to push for a ban on individual stock trading for Members of Congress, it’s beyond time to hold executive branch leaders accountable to their duty and I’m proud to help lead the bipartisan effort to do so with Congressman Cloud.”

Congressman Cloud believes that while Congress should ban stock trading for members of Congress, the same must be applied to unelected senior level bureaucrats with far-reaching power over America’s economy, industries, and regulations. SES employees and their spouses would still be permitted to invest in diversified mutual funds, exchange-traded funds (ETFs), and U.S. Treasury bonds.

Read more from the Washington Times here.

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