In reporting a stock sale nine months past a federal deadline, Sen. Thom Tillis (R-NC) joins the growing list of legislators who’ve struggled to abide by a decade-old conflicts-of-interest and financial disclosure law.
Tillis on July 15 disclosed an August 2022 sale of multinational IT services provider Kyndryl Holdings stock valued between $1,001 and $15,000, according to a federal financial document reviewed by Raw Story.
But, Tillis’ congressional office says the late submission was due to a “processing” error.
“Senator Tillis disclosed the sale to Senate Ethics within the 45-day window but didn’t realize the submission was never processed through the website,” said Adam Webb, a Tillis spokesperson, in an email. “Senate Ethics was able to see the work he did on his periodic transaction disclosure from that time (which was completed). They also noted this has happened to other members before and they plan to make future improvements to the website to add better submission prompts and notifications.”
Federal lawmakers’ completed stock-trade disclosures are posted to a public website for anyone — including lawmakers and their staffers — to review. Tillis' office did not explain why nine months elapsed before the missing disclosure was discovered.
The Stop Trading on Congressional Knowledge (STOCK) Act — passed in 2012 to stop insider trading, curb conflicts-of-interest and enhance transparency — requires prompt reporting within 45 days of most purchases, sales and exchanges of stocks, bonds, commodity futures and cryptocurrency by key government officials, particularly members of Congress.
Webb said the value of Tillis’ stock was under $2,000 and were “common shares distributed by IBM when Kyndryl recently became its own publicly traded company.”
“As you can see from his disclosures over the years: 1) Senator Tillis sold most of his stocks very early in his first term to avoid the appearance of any conflict of interest, 2) Senator Tillis has never purchased stocks during his tenure and 3) he currently only has long-held IBM stock, which dates back to his tenure as a management consultant for the company,” Webb said.
Tillis is appointed to four Senate committees: Finance; Judiciary; Veterans’ Affairs; and Banking, Housing and Urban Affairs.
The standard fine for violating the STOCK Act is $200, but the House Committee on Ethics and Senate Select Committee on Ethics have historically waived the fees for many violators.
As for Tillis paying a fine, Webb said, "he was quickly approved for a waiver for being late ‘based on the circumstances described.’”
Some lawmakers argue the STOCK Act has proven inadequate, and on Wednesday, two of his colleagues — Sens. Kirsten Gillibrand (D-NY) and Josh Hawley (R-MO) — introduced new legislation that would ban congressional stock trading and push for stronger disclosure requirements.
Dubbed the Ban Stock Trading for Government Officials Act, the legislation would prohibit members of Congress, the president, the vice president, senior executive branch officials, their spouses and children from trading stocks and would require greater transparency with financial disclosures, The Hill reported.
“The American people are fed up with corruption in Congress. A long line of lawmakers from both parties have now violated the STOCK Act, a law intended to stop lawmakers from getting rich off non-public information they come across in the course of their legislative duties,” Brett Edkins, managing director of policy and political affairs at Stand Up America, told Raw Story in a statement. “It’s clear that new laws must be passed to restore integrity and ethics to Congress.
“It is past time to reform the STOCK Act and finally ban sitting members of Congress from trading individual stocks,” Edkins added. “A majority of Americans from across the political spectrum support a ban on congressional stock trading. Members of Congress should listen to their constituents and restore the public’s trust by banning sitting lawmakers, their spouses and dependent minors from trading stocks.”
In a recent interview with Raw Story, one of the STOCK Act’s original authors, former Rep. Brian Baird (D-WA), blasted Congress for its continued excuses for failing to abide by the law.
“I mean, come on. ‘The dog ate my homework,’ aren’t we a little more grown up than that?” Baird said. “If we're capable of voting on whether or not to raise or lower taxes or send people to war, I think we can report when we make an investment.”
Epidemic of violations
Dozens of members of Congress have failed to comply with the STOCK Act. During the 117th Congress from 2021 to 2022, at least 78 members of Congress — Democrats and Republicans alike — were found to have violated the STOCK Act's disclosure provisions, according to a tally maintained by Insider.
Raw Story has this year identified at least 18 members of the 118th Congress who have broken the federal conflicts of interest law, including the new addition of Tillis.
In recent weeks, Rep. Sen. Tom Carper (D-DE) violated the STOCK Act for the third time in 14 months, and Rep. Debbie Wasserman Schultz (D-FL) was several months late disclosing a family stock sale — again.
The ongoing violations come at a time when a bipartisan group of lawmakers have introduced several similar bills aimed at banning congressional stock trading.
Like the new Ban Stock Trading for Government Officials Act, another two-party bill, the Bipartisan Restoring Faith in Government Act was introduced in May. The bill is co-sponsored in part by political rivals in Reps. Alexandria Ocasio-Cortez (D-NY) and Matt Gaetz (R-FL).
Other materially similar bills include the Ending Trading and Holdings in Congressional Stocks (ETHICS) Act, the TRUST in Congress Act and the Preventing Elected Leaders from Owning Securities and Investments (PELOSI) Act. In the decade since the STOCK Act’s passage, the push for a total ban on lawmakers trading stocks while in office gained but then lost momentum last year when the Democratic-led House, then led by Speaker Emerita Nancy Pelosi, decided not to conduct a hearing on any of stock-ban bills and never brought it to the House floor for a vote.
News organizations including the New York Times, Insider, NPR and Sludge have documented rampant financial conflicts of interests among dozens of members of Congress, such as those who bought and sold defense contractor stock while occupying positions on congressional armed services committees or otherwise voting on measures to send such companies billions of federal dollars. The executive and judicial branches are riddled with similar financial conflict issues, too, as the Wall Street Journal has reported.
The Wall Street Journal won a 2023 Pulitzer Prize for its investigation into financial conflicts among officials who work in federal agencies while Insider won the Society of Professional Journalists’ Sunshine Award for its reporting on congressional financial conflicts.
