Last modified: Thursday, December 1, 2011
IU Maurer School of Law expert to testify before Congress on insider trading laws
Hearing triggered by '60 Minutes' story on congressional stock trading
FOR IMMEDIATE RELEASE
Dec. 1, 2011
BLOOMINGTON, Ind. -- An Indiana University Maurer School of Law securities law expert is scheduled to testify today before a Senate committee on pending legislation that would expressly prohibit insider trading by members of Congress and legislative staffers.
Professor Donna M. Nagy will testify at 2:30 p.m. EST today, Dec. 1, before the Senate Committee on Homeland Security and Governmental Affairs, chaired by Sen. Joseph Lieberman, I-Conn. The hearing will focus on "Insider Trading and Congressional Accountability" and will examine the proposed Stop Trading on Congressional Knowledge (STOCK) Act. Nagy will testify that congressional insider trading is already illegal because anti-fraud provisions in the federal securities laws and the federal mail and wire fraud statutes apply equally to everyone, Congress included.
In addition, although Nagy applauds and endorses the motivation behind the proposed legislation, she will point out the risk that, in the absence of a modification to its wording, the STOCK Act could be viewed as the only insider trading law that applies to Congress. She says this risk of pre-emption is troubling because the proposed legislation fails to reach a host of possible scenarios involving congressional insider trading that would almost certainly fall within existing law.
Nagy has written an extensive article on this topic titled "Insider Trading, Congressional Officials, and Duties of Entrustment," which can be accessed via the Social Science Research Network. Her comments are also available in an Indiana University news release. She is available to comment on the STOCK Act and insider trading laws in general and can be reached at firstname.lastname@example.org, or at 812-856-2826.