Rep. Zoe Lofgren (D-CA), who last year led Democratic House leadership’s self-aborted effort to ban congressional stock trading, just became the latest lawmaker to violate the STOCK Act with up to $265,000 in late financial disclosures, according to a Raw Story analysis of financial records.
Lofgren violated the Stop Trading on Congressional Knowledge (STOCK) Act by failing — in one case, for months — to properly disclose her husband's sale of two stocks.
Lofgren was late in reporting her husband’s partial sale March 23 in software company Deskworks Inc. stock, valued between $100,001 to $250,000. She was also late in disclosing her husband’s sale of $1,001 to $15,000 worth of Expedia Group stock on August 25, 2022.
Members of Congress are only required to disclose the values of such trades in broad ranges.
“All of these transactions, which are related to my husband’s solo practice retirement accounts, are managed by a financial advisor. I do not know about them until they are reported. If there is a late fee owed, it will be paid,” Lofgren told Raw Story in a statement.
RELATED ARTICLE: As First Republic Bank faltered, five members of Congress dumped their personal stock investments
The STOCK Act requires lawmakers to publicly reveal, within 45 days, any individual stock, bond or cryptocurrency transaction‚ including those of their spouses and dependent children. The law, passed by Congress in 2012, is designed to prevent insider trading, promote transparency and reduce conflicts of interest among federal lawmakers and other government officials.
In the midst of numerous scandals and STOCK Act violations, Speaker Emerita Nancy Pelosi (D-CA) tasked Lofgren — then the chairwoman of the Committee on House Administration — with conducting an April 2022 public hearing on stock trading by members of Congress.
But the panel did not reach a consensus, The Hill reported. Lofgren in September introduced the Combatting Financial Conflicts of Interest in Government Act, which would ban Congress members and staff and Supreme Court justices from trading stock.
The Democratic-led House, then led by Pelosi, decided not to conduct a hearing on Lofgren’s bill — or any of several similar stock-ban bills — and never brought it to the House floor for a vote.
Lofgren told Raw Story in a statement that she does not personally trade individual stocks and has “never done so in my entire life.
RELATED ARTICLE: ‘I mistakenly left it in draft’: Republican violates STOCK Act with up to $5 million in late disclosures
“Any individual stock listed in any of my filings come from my husband’s retirement accounts and are listed as such. As noted in the transaction report, my husband is the stock owner through his solo practitioner law firm’s retirement funds, and he reported the assets once he was alerted of them by the financial advisor,” Lofgren said. “In the last congressional session, I introduced the Combatting Financial Conflicts of Interest in Government Act, which would end insider trading by members of Congress, and I engaged with many pro-transparency and pro-democracy groups during the bill-writing process.
“Right now, my husband is making adjustments to his accounts – moving from stocks to mutual funds and exchange traded funds – as we agree with the reform groups’ advocacy,” Lofgren added. “There will be much more activity in my husband’s financial transactions in the coming weeks, which will be reflected through a series of required Periodic Transaction Report filings, as he proactively moves to align his accounts to widely-held investments.”
The most recent bill to be introduced this session — the Bipartisan Restoring Faith in Government Act — 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 Act.
Continued violations
Lofgren joins a growing list of congresspeople who Raw Story has reported on violating the STOCK Act.
Most recently, Raw Story broke the news that Rep. Dan Bishop (R-NC) violated the STOCK Act when he failed to properly disclose purchasing up to $5 million in U.S. Treasury notes.
In January, Raw Story broke the news that Rep. Seth Moulton (D-MA) failed to properly disclose that his wife sold up to $100,000 worth of stock in gaming company Activision Blizzard in September 2022 and purchased up to $15,000 worth of stock in Amazon.com in August 2022.
Raw Story also reported that Rep. Gerry Connolly (D-VA) was several days late disclosing that he had sold personal stock in an energy company and a pair of federal defense contractors. Sen. Tom Carper (D-DE) also violated the STOCK Act in March with a late disclosure.
During the 117th Congress from 2021 to 2022, at least 78 members of Congress — dozens of Democrats and Republicans alike — were found to have violated the STOCK Act's disclosure provisions, according to a tally maintained by Insider.
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 hasreported.
The Wall Street Journal won a 2023 Pulitzer Prize for its investigation into financial conflicts among officials who work in federal agencies.
Dylan Hedtler-Gaudette, senior government affairs manager with the Project on Government Oversight, a nonpartisan watchdog group that exposes conflicts of interest in the government, told Raw Story last week that he expects little to no consequences for violations of the STOCK Act.
“We’ve seen a lot of these kinds of violations in the STOCK Act disclosure requirements over the past couple of years, and I think it just speaks to a larger issue that really pervades the institution of Congress, and that’s that they just don't really take their ethics very seriously,” Hedtler-Gaudette said. “In particular, they don't take their disclosure requirements and their transaction reporting requirements seriously, and that's a problem because already the public doesn't trust Congress, generally speaking.”
POGO said its ideal vision for policies around congressional stock trading would be a ban on trading stocks and other assets like commodities and futures that are susceptible to insider trading while in office.
“It’s not that we don't want people to be able to have a financial portfolio, and obviously everyone ought to be able to save as far as retirement goes, but they just shouldn't be able to have an unfair advantage,” Hedtler-Gaudette said. “In the current moment that’s what they have right now.”
