A little dramatic, but it's the headline at The Motley Fool for an article on insider trading by Congress. While not insider trading in the sense of the term as securities attorneys would use the term, what Congress is being accused of is every bit the same.
Today, if a congressman learns that his committee is about to pass a rule that would affect a particular company or group of companies, he can trade on that information because he is not required to keep that information confidential. If anyone else on this green earth was in a similar situation, the SEC would be on them in a flash, with a civil suit for disgorgement and a penalty equal to two times the profit they earned.
Once we agree as a society with the concept that insider trading is bad for the markets, bad for the economy and bad for investors, this Congressional loophole in the securities regulations is an outrage. Take a look at the Motley Fool article, the examples that they have provided are outrageous examples of amazing market timing by specific members of Congress.
It's time for a change in the law. Either we amend the current securities laws to encompass and prohibit this conduct, or force Congress to put their investments in blind trusts. The problem is, who is going to force them to pass that law? The only one who can force Congress to stop this conduct is Congress!
And there is virtually no chance of that ever happening.
