By Alexander Bolton - 03/22/12 06:00 PM EDT
The Senate on Thursday passed legislation barring lawmakers from using insider information for personal profit, sending the bill to the White House.
The Stop Trading on Congressional Knowledge (STOCK) Act already approved by the House passed the upper chamber easily by a vote of 96-3.
Instead of holding a conference between Senate and House negotiators to discuss the differences, Senate Majority Leader Harry Reid (D-Nev.) opted to take up the House bill.
The Grassley language had created unusual political bedfellows.
House Republican Whip Eric Cantor (R-Va.) opposed the language and did not include it in the House bill that passed overwhelmingly, 417-2.
Reid and his leadership team, along with Senate Minority Leader Mitch McConnell (R-Ky.), voted against the Grassley amendment in the Senate, but leading Democrats including Minority Leader Nancy Pelosi (Calif.) supported it in the House.
Grassley’s language would have dramatically expanded the disclosure of lobbying activities by requiring specialists who glean valuable information from Capitol Hill to register and report their activities after making even one contact to gather political intelligence. Hedge funds and other money managers pay top dollar for the information, which can be used to make lucrative trades.
Grassley voted against final passage of the STOCK Act in the Senate along with GOP Sens. Richard Burr (N.C.) and Tom Coburn (Okla.).
Supporters of the bill hailed the measure, which they said could restore public confidence in Congress.
“We passed a strong bill with teeth that will clearly and expressly make it illegal for members of Congress, their staff and their families to gain personal profits from nonpublic information gained through their service,” said Sen. Kirsten Gillibrand (D-N.Y.), a sponsor of the legislation.
“When President Obama signs the STOCK Act, we will have begun to restore some of the public’s faith in Washington,” she added.
Lawmakers sometimes possess nonpublic information that can be worth millions of dollars if known in advance by a well-connected trader.
Reid said earlier this week that he would skip appointing conferees to negotiate differences between the Senate and House bills. Reid said that unnamed senators would have objected to proceeding to conference and it would have taken too much time to vote them down.
Insider trading surged to the top of the political agenda in recent months after a report by CBS’s “60 Minutes” alleged senior lawmakers had profited from the knowledge they accrued as congressional insiders.
The report raised questions about healthcare stocks House Speaker John Boehner (R-Ohio) bought during the 2010 healthcare reform debate once it became clear that the proposal of a government-run health insurance option would fail.
Boehner said he does not personally manage his stock portfolio.
CBS also scrutinized Pelosi’s participation in an initial public stock offering from Visa. She and her husband bought stock in the company while a bill to limit fees charged by credit card companies was pending in the House.
A spokesman for Pelosi at the time dismissed the allegations as “a right-wing smear."