Bachus agrees to hold hearing on bill to prevent insider trading by lawmakers

House Financial Services Committee Chairman Spencer Bachus (R-Ala.) announced Thursday that his panel would be considering legislation to prohibit lawmakers from investing based on private information.

The chairman announced the Dec. 6 hearing one day after ranking member Barney Frank (D-Mass.), sent a letter to Bachus, calling on the committee to consider such legislation and eventually pass it. The announcement also comes after Bachus has come under scrutiny for allegations that he profited on investments made based on private information.

"Existing law clearly prohibits insider trading by members of Congress. However, the American public deserves for there to be no question or equivocation concerning members of Congress or any citizen being exempted from laws prohibiting insider trading," Bachus said in a statement.

Frank told Bachus in his letter that he had "neglected" similar legislation when he was chairman of the committee, but that recent attention to the matter meant the bill should be considered and passed.

The panel will consider a bill, introduced by Reps. Louise Slaughter (D-N.Y.) and Tim Walz (D-Minn.), which would prohibit members and White House employees from investing based on private information, or from passing that information along to others for investment purposes.

That legislation was introduced earlier in the 112th Congress, but languished until a new book and '60 Minutes' report suggested that several members may have personally profited based on information obtained as lawmakers.

Bachus, a longtime and active trader, was singled out in both, as they highlighted various moves that looked as if they could have been motivated by things he learned as a high-ranking lawmaker, including from private meetings held with financial regulators at the height of the financial crisis. The pieces also scrutinized moves made by House Speaker John Boehner (R-Ohio) and Minority Leader Nancy Pelosi (D-Calif.), who both defended their actions.

Bachus launched a spirited defense of his actions Wednesday, writing in a letter to the book's publisher that it was a "total lie" that he profited from non-public information, and detailing several errors in the book.

Similar bills are being introduced in the Senate by Sens. Scott Brown (R-Mass.) and Kirsten Gillibrand (D-N.Y.), and the Senate Homeland Security and Governmental Affairs Committee will also discuss the issue at an upcoming hearing.

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