McCarthy swipes at Pelosi over ban on lawmaker stock trading
House Minority Leader Kevin McCarthy (R-Calif.) took a swipe at Speaker Nancy Pelosi (D-Calif.) on Friday over reports that Democratic lawmakers are planning to introduce a ban on lawmaker stock trading next month.
McCarthy during his Friday press conference said it is not “proper” for Pelosi to write the bill regarding a ban on congressional lawmakers’ stock trading, pointing to investments her husband, Paul Pelosi, a venture capitalist, has made. According to Insider, the couple has attained the vast majority of their wealth through financial transactions made by Paul Pelosi.
“I think we have to do a thorough investigation and look at what is the proper role for members of Congress and what influence they have, and I don’t think the proper way to do this is Nancy Pelosi writing the bill because we have proven that she can’t do that,” McCarthy told reporters.
Pelosi signed a periodic transaction report on Tuesday revealing that her husband had sold up to $5 million worth of stocks of Nvidia, a software company. According to the document, the transaction incurred a loss of $341,365. A separate periodic transaction report signed by the Speaker on July 14 revealed that her husband exercised 200 call options of Nvidia that month.
The document reflecting the sale of stock came one day before the Senate passed a chips and science bill, which the House cleared the next day.
Asked about the decision to sell the holdings around the time of the House vote, Pelosi spokesperson Drew Hammill told The Hill in a statement that Paul Pelosi purchased options to buy stock of Nvidia more than a year ago and ultimately exercised them on July 17.
“As always, he does not discuss these matters with the Speaker until trades have been made and required disclosures must be prepared and filed. Mr. Pelosi decided to sell the shares at a loss rather than allow the misinformation in the press regarding this trade to continue,” Hammill added.
Punchbowl News reported on Thursday that House Democrats are planning to roll out a framework in August to prohibit lawmakers, their spouses and senior staff from trading stocks and either divest fully or put the investments in a qualified blind trust. Sources close to the issue told the outlet that individuals subject to the bill would still be permitted to invest in mutual funds.
McCarthy on Friday suggested that Pelosi may have shared information about the chips bill with her husband, while acknowledging that he did not know for sure if those conversations occurred.
“Look, I think the Speaker of the House has greater determination of what comes to the floor, what gets out of the committee. And her husband didn’t just trade stock, he traded options. I think what her husband did was wrong,” McCarthy said.
“When she said she never told him anything, I know they spent their time together overseas and when they’re coming back, I’m sure she had conversations on the phone about what was gonna be on the floor. I’m sure she had conversations about what the chip version finally looked at. I’m sure she had those conversation; I don’t know if he was able to hear them or not. But I think we need to bring trust back to this institution,” he added.
McCarthy said that if Republicans take control of the House in November and he becomes Speaker as a result, he will “look all the way through” legislation to ban lawmakers from trading stocks. The minority leader said he only owns mutual funds and not stocks.
“What I’ve told everybody, we will come back and we will not only investigate this, we will come back with a proposal to change the current behavior,” he added.
Asked for comment on McCarthy’s remarks, Hammill told The Hill, “The Minority Leader’s ridiculous comments aside, insider trading is already a federal criminal and civil violation and the Speaker strongly supports robust enforcement of the relevant statutes by the Department of Justice and the Securities and Exchange Commission.”
“We look forward to his support of the proposal Chair Lofgren will be circulating soon to ban trading of stocks,” he added.
Lawmakers in both the House and Senate have introduced bills this year to ban members of Congress from trading stocks, but none have taken off.
Pelosi at first was not supportive of a ban on lawmaker stock trading, arguing that members of Congress should be permitted to take part in the “free-market economy.”
In January, however, she changed her stance, with multiple sources reporting that the Speaker informed the House Administration Committee to start drafting a measure.
—Updated at 4:41 p.m.