H.R. 7008 — Stop Insider Trading Act

This section adds a new subchapter IV to chapter 131 of title 5, United States Code, establishing restrictions on "covered investments" (i.e., securities issued by publicly traded companies or comparable synthetic interests such as derivatives) for "covered individuals" (i.e., Members of Congress, their spouses, and dependent children). Covered investments exclude (1) excepted investment funds or funds concentrated in the U.S. or the covered individual's state/territory of residence; (2) interests in small business concerns as defined in 15 U.S.C. 632; and (3) investments in trusts where no covered individual controls the trustee and the trustee is not a close relative of a Member. Under the restrictions, covered individuals generally may not purchase covered investments, and Members must provide public notice at least 7 calendar days (and no more than 14 calendar days) before any sale of a covered investment by themselves, their spouse, or dependent child—including the projected sale date, description, and number of shares—with notices filed with the Clerk of the House or Secretary of the Senate and posted online (notices must be withdrawn if the sale does not occur). Exceptions apply to spousal/dependent child transactions for occupational purposes or a covered individual's reinvestment of dividends from existing covered investments. Violations trigger enforcement by the supervising ethics office, requiring the responsible Member of Congress to pay a fee equal to the greater of $2,000 or 10% of the transaction value plus any net gains realized since becoming a covered individual, and to divest prohibited purchases; such fees may not be paid from official office funds or campaign contributions.