November 14th, 2011 2:32 pm EST
Is it OK for Members of Congress to Trade Using Insider Information?
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Q. Is Insider Trading Legal for Members of Congress?
A. Yes.
The way that the laws in the United States are currently written, insider trading (trading with the benefit of non-public information) is perfectly fine for members of Congress.
That's right - members of Congress can trade using insider information and it is perfectly legal. No fines. No jail time. 100% legal.
 The lack of insider trading laws for members of Congress has been under the spotlight ever since a CBS 60 Minutes investigative report aired on November 13th, 2011. The report contended that members of Congress routinely trade using insider information, and that there are absolutely no rules against them doing so.
The report alleged that House Financial Services Committee Chairman Spencer Bachus (R-Ala.) even bet AGAINST US markets during the height of the economic meltdown. According to Politico.com, Bachus was "getting briefed by top officials at the Treasury Department and Federal Reserve about the impending collapse of the American financial markets."
According to Biggovernment.com, Bachus bet against the US market and General Electric during the height of the economic meltdown and profited handsomely.
That's right - the current chairman of the House Financial Services Committee allegedly (he denies it) bet AGAINST the markets in 2008. If Joe Average had profited using non-public information, he very likely would have gone to jail. When a member of Congress does it? Completely legal.
According to Biggovernment.com, Bachus asked the US House of Representatives Ethics Committee if there was any issue with his trades, and that told him that there was "no problem".
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Many people claim that members of Congress should not be allowed to trade at all - especially using NON-PUBLIC information.
What do you think?
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