Insider or Not? – The Congressional Bank Trades 📈📉

Insider or Not? – The Congressional Bank Trades

One of the most well-known crimes in the stock market is insider trading, where an individual trades a company’s stock while having access to confidential information that is not available to the public. This can apply to the person with the knowledge, or those close to that individual who received access. That exact reason is why insider trading is so hard to pin down as it’s unclear whether purchases were made “unlawfully”, but when it’s clear the punishment is heavy.

What’s even more unclear is the rules surrounding how members of the government can trade stocks. Federal officials like the members of Congress are often briefed and aware of situations that could impact parts of the economy before the public, and it seems to create a conflict of interest. This was seen recently with the regional bank crisis, with at least 8 members of Congress or their relatives selling bank shares in the month of March, the number likely to increase. This activity is legal under law, but many question if it should due to the advantage lawmakers have when it comes to knowledge on certain sectors. The issue is not limited to partisanship either as there have been numerous instances where members of both parties made controversial moves. Back in 2020, former Republican senators Kelly Loeffler and David Perdue made countless trades before the COVID-19 crash as they were briefed about its severity earlier, and Perdue was a notorious trader during his time in the Senate. Former Speaker Nancy Pelosi of the Democratic Party also stirred controversy when her husband Paul Pelosi bought shares in chip companies ahead of the CHIPS Act. However, both parties are looking to reform the rule to prevent any form of trading with an advantage, which will have to go through these lawmakers themselves.

Want to learn how to invest? Download the Invstr app, where you can play Fantasy Finance and manage a virtual investment portfolio or open a brokerage account and invest for real. Take our interactive investing course on Invstr Academy and become a better investor today!

I am not a financial advisor and my comments should never be taken as financial advice. Investments come with risk, so always do your research and analysis beforehand.

Share:

More Posts

Load More
Get your daily Invstr Crunch

Get the market news and updates you need, delivered to your inbox or available on our daily podcast.

Facebook Twitter Youtube Instagram Snapchat Tiktok
learn
products
plan
Who we are
blog

Risk Disclosure:

Invstr is not a bank and banking services are provided by Vast Bank, N.A.

Brokerage and Banking services are currently only available to U.S. residents.

Invstr app and web services are provided by Invstr Ltd. Advisory services are provided by Invstr Financial LLC, an investment adviser registered with the Securities Exchange Commission (SEC) details of which can be obtained here. Securities brokerage and custody services are provided by Apex Clearing, a broker dealer registered with the SEC and a member of FINRA and SIPC. There is no bank guarantee on securities and securities may lose value.

Investing involves risk and can lead to losses. Past performance does not guarantee future results.

Invstr app and web services are provided by Invstr Ltd. Invstr+ advisory services are provided by Invstr Financial LLC, an investment adviser registered with the Securities Exchange Commission (SEC). Securities brokerage and custody services are provided by Apex Clearing, a broker dealer registered with the SEC and a member of FINRA and SIPC. There is no bank guarantee on securities and securities may lose value. Vast Bank N.A. a nationally chartered bank and member of the FDIC, provides the banking products, including the products and services related to digital asset accounts. As with any asset, the value of Digital assets can go up or down and there can be a substantial risk that you lose money buying or holding digital assets. You should carefully consider whether trading or holding Digital assets is suitable for you in light of your financial condition. Your digital account does not support wallet to wallet transferring of your digital assets (i.e. cryptocurrencies) outside the platform. Any Digital Assets in your digital asset account are not insured by any government entities, including but not limited to FDIC or SIPC. The Invstr Visa® Debit Card is issued by Vast Bank, N.A. pursuant to a license from Visa U.S.A Inc and may be used everywhere Visa debit cards are accepted. Invstr Ltd, Invstr Financial LLC and Invstr Securities Ltd are subsidiaries of Marketspringpad Holdings (collectively “Invstr”) and Invstr is solely responsible for the application services and website content.

Watchlists provided when users first access the service are not a recommendation to invest. Instead they are provided to help users better navigate the service. Users are free to edit and create their own watchlists. From time to time, Invstr will suggest instruments solely based on an individual’s interest and the interest levels of the Invstr community. The statistical and portfolio builder models generated by Invstr do not reflect actual investment results and are not guarantees of future results. Comments provided by Invstr leaders, influencers or members of the Invstr Community are not recommendations and should not be construed as such. Invstr does not endorse the content or the positions posted by them. Their investment approach, and that of the models provided by Invstr, may be different from yours and may not be appropriate for you.