WASHINGTON — On Capitol Hill this week, support is rapidly expanding for a bill aimed at stopping members of Congress from profiting from their own inside knowledge about the legislative process.
The bill's sudden burst in popularity — committees in both the House and Senate are scrambling to schedule hearings on the issue — follows a 60 Minutes report on Sunday about congressional representatives from both political parties making trades after receiving non-public information.
The House version of the bill, which would prohibit trading of stocks and other investment vehicles based on non-public information about future legislative action, had only 10 co-sponsors prior to the 60 Minutes broadcast. By Thursday, that number was up to 47, most of them Democrats.
Rep. Spencer Bachus, who chairs the House Financial Services Committee, was among the lawmakers whose trades were scrutinized by 60 Minutes. The TV report suggested that the Alabama Republican used information gleaned from 2008 meetings with Federal Reserve Chairman Ben Bernanke and former Treasury Secretary Henry Paulson to invest in funds that gained in value when the overall market fell.
Bachus has denied doing anything improper, saying that all of the information he used was public.
On Thursday, Democratic Rep. Barney Frank, the former chairman of the Financial Services Committee, urged Bachus to enact some version of the House reform bill.
"I should add that I am particularly eager to see us do that because I do not see any negatives that can come from it," Frank wrote in a letter to Bachus. "I acknowledge that this is something that should have gotten attention when I was chair."
A few hours later, Bachus' staff on the Financial Services Committee announced plans to hold a Dec. 6 hearing on the bill, known as the Stop Trading on Congressional Knowledge Act, or STOCK Act.
"Existing law clearly prohibits insider trading by Members of Congress," Bachus said in a press release announcing the hearing. "However, the American public deserves for there to be no question or equivocation concerning members of Congress or any citizen being exempted from laws prohibiting insider trading. Towards this goal, a full committee hearing on the STOCK Act is being held at the earliest possible date to help answer those questions."
In the Senate, four members who are up for re-election in 2012 — Republican Scott Brown and Democrats Debbie Stabenow, Jon Tester and Kirsten Gillibrand — all announced plans this week to introduce versions of the House legislation.
In addition, the Senate Homeland Security and Government Affairs Committee said that it plans to hold a hearing on how insider trading laws apply to Congress. That hearing is expected to be held in late November or early December.
