Wednesday, February 8, 2012

Window dressing for Congressional insider trading

The recently passed STOCK Act will allegedly curb insider trading by members of Congress.  As documented in research (here and here) by my Lindenwood colleague Jim Boyd and his co-authors, members of Congress are able to profit substantially from the information they obtain while doing the people's business.  Peter Schweitzer doesn't think much of the STOCK Act and prefers the RESTRICT Act because it might actually work.  The fact that the STOCK Act passed the Senate 96-3 is enough to suggest that it would be pretty useless in curbing the practice.