A key Senate committee has taken a significant step forward on legislation that would prevent members of Congress, the president, and vice president from trading or owning stocks. The Senate Homeland Security and Governmental Affairs Committee passed the measure by an 8-7 vote, despite opposition from the White House, which had actively lobbied against including the executive branch in the proposed ban.
The committee vote saw all Democrats join forces with one Republican—the bill’s sponsor, Senator Josh Hawley of Missouri—to advance the legislation. Originally dubbed the Preventing Elected Leaders from Owning Securities and Investments Act (PELOSI), the bill took aim at Representative Nancy Pelosi of California, who has faced intense scrutiny for her profitable stock trades and allegations of insider trading, which she has consistently denied while supporting previous congressional trading bans.
🚨 BREAKING: The PELOSI Act, which BANS Congressional stock trading, has just passed out of committee, 8-7
The name of this bill is PERFECT 🤣🔥 pic.twitter.com/R9LYERij1k
— Nick Sortor (@nicksortor) July 30, 2025
Legislative Compromises and Exemptions
Through negotiations with Democratic lawmakers, Hawley agreed to replace his original PELOSI Act with a similar piece of legislation known as the Honest Act. In exchange for this compromise, Democrats accepted a provision that would extend the trading prohibition to include the president and vice president. However, the current administration would avoid the restrictions, as President Donald Trump and Vice President JD Vance would be exempt since the ban would only become effective at the beginning of new office holders’ terms.
The White House mounted a lobbying effort against the inclusion of executive branch officials in the ban, according to reports from multiple news outlets. This stance appears to contradict Trump’s previous public statements supporting a stock trading ban specifically for Congress members.
Republican Opposition Emerges
The legislation faced criticism from within Republican ranks, with Senator Rand Paul of Kentucky encouraging Democrats to oppose the bill due to its exemption for Trump and Vance. The measure also lost support from one of its original backers, Senator Bernie Moreno of Ohio, who withdrew his endorsement when Hawley introduced the modified version. During Wednesday’s hearing, Moreno expressed confusion about the legislation, telling fellow lawmakers he had “no idea what we’re voting for.”
Recent congressional ethics investigations have highlighted ongoing concerns about lawmakers’ trading activities. The House Ethics Committee recently recommended that Representative Mike Kelly of Pennsylvania and his wife divest their holdings in steel company Cleveland-Cliffs. Following a four-year investigation, the committee found no evidence of insider trading but discovered substantial evidence that Kelly violated congressional conduct rules related to over $64,000 in profits his wife made from a 2020 stock purchase that occurred after Kelly lobbied against a Cleveland-Cliffs factory closure in his district.
Congressional stock trading has remained a contentious issue for decades, with critics arguing that lawmakers gain unfair advantages through early access to policy information that could affect stock prices. Current regulations, established under legislation signed by former President Barack Obama in 2012, require Congress members to publicly report trades exceeding $1,000 within 45 days, but do not prohibit the trading activity itself.
Potential Legislative Impact
This development represents a measured step toward increased financial oversight of elected officials, though the bill’s ultimate passage remains uncertain given the divided committee vote and ongoing political negotiations. The legislation’s progress suggests growing bipartisan interest in addressing conflicts of interest, albeit with significant compromises that may limit its immediate effectiveness.
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