How Congress Quietly Overhauled Its Insider-Trading Law : It's All Politics With no fanfare, Congress moved to undo large parts of the popular law known as the STOCK Act, and President Obama has signed the watered-down measure into law. Insider trading is still illegal, but disclosures of large stock trades by staffers will be harder to get than under the original law.

How Congress Quietly Overhauled Its Insider-Trading Law

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The legislative process on Capitol Hill is often slow and grinding. There are committee hearings, filibuster threats and hours of floor debate. But sometimes, when Congress really wants to do get something done, it can move blindingly fast. That's what happened when Congress moved to undo large parts of a popular law known as the STOCK Act. NPR's Tamara Keith has that story.

TAMARA KEITH, BYLINE: When President Obama signed the STOCK Act into law a year ago, there was a celebratory signing ceremony.


KEITH: The law wouldn't just outlaw trading on non-public information by members of Congress, the executive branch and their staffs. It would make financial disclosures searchable so insider trading and conflicts of interest would be easier to detect. But yesterday, when the president signed a bill reversing big pieces of the law, the emailed announcement was one sentence long.

There was no fanfare last week either, when the Senate and then the House passed the bill in largely empty chambers using a fast-track procedure known as unanimous consent.

UNIDENTIFIED MAN: For what purpose does the gentleman from Virginia seek recognition?

REPRESENTATIVE ERIC CANTOR: Mr. Speaker, I ask unanimous consent to take...

KEITH: The gentleman from Virginia is House Majority Leader Eric Cantor, who shepherded the bill through the House. It was Friday afternoon at 12:52.

UNIDENTIFIED MAN: Without objection, the bill is passed and...

KEITH: The whole thing took exactly 31 seconds. Craig Holman is the government affairs lobbyist for Public Citizen. To understand how the law changed, I asked him to meet me in the basement of the Cannon House Office Building.

CRAIG HOLMAN: This is where the public records are kept, for those who can handle traveling to Washington, D.C.

KEITH: You heard that right. If you want to look up the financial disclosure forms filed by high-level congressional staffers, you have to come to this office. We weren't allowed to record inside, but Holman showed me how it works.

HOLMAN: The database itself is almost meaningless. All we can do is look at one by one case of the 2,900 staffers that have filed, and that's just too big a job for anybody to do.

KEITH: The STOCK Act was supposed to make this task significantly easier. Records for members of Congress, the executive branch and their staffs were supposed to be posted online in a searchable format. If you wanted to see who traded healthcare stock just before a committee acted on a healthcare bill, it would be easy. No trips to the basement required. But there were concerns about national security risks and identity theft from posting this financial information online. An independent study recommended changing the law.

The White House cited that in explaining why the president signed the bill. And a spokesman for Cantor said the House and Senate were simply doing what the study called for. But Lisa Rosenberg, a lobbyist for the Sunlight Foundation, which advocated for the STOCK Act, says Congress went too far.

LISA ROSENBERG: It's really shocking that they used, basically, the situation of questions about whether some language in the bill was overbroad to just - just to gut the bill, to gut the transparency measures that apply to themselves.

KEITH: Still two major elements of the law remain. Insider trading is illegal, even for members of Congress and the executive branch. And for those who are covered by the now narrower law, disclosures of large stock trades are required within 45 days. It will just be harder to get to them. Tamara Keith, NPR News, the Capitol.

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