No Profiting from Public Service

Summary#

This bill, the No Profiting from Public Service Act, would add rules to the federal ethics code that limit certain financial ownership and trading by high-level officials and some close family members. It defines who is covered (Members of Congress, judges, the President, Vice President, senior executive officials, certain candidates, and their spouses and dependent children). "Covered investments" would include securities, commodities, futures, and similar derivative or synthetic positions. Exceptions include diversified mutual funds and ETFs, widely held investment funds, U.S. Treasury and state or municipal bonds, certain small business or family farm interests, some Alaska Native settlement shares, compensation paid to a spouse or dependent, and holdings in a qualified blind trust.

The bill would ban covered officials from owning or trading covered investments except by divesting or placing the assets into a qualified blind trust. It would also bar covered individuals from participating in prediction market contracts tied to specific political or government events. Covered officials would generally have 90 days to divest or transfer such assets after enactment or after acquiring them by marriage, inheritance, or similar events. A blind trust containing these assets could not be dissolved or controlled by the official until 180 days after they leave office. The supervising ethics office (or the Federal Election Commission for certain candidates) would issue certificates of divestiture, publish fines and reasons on a public website, and provide guidance on undefined terms.

Violations would trigger penalties set by the supervising ethics office: a fine equal to 10 percent of the value of the covered investment or prediction market contract and disgorgement of any profits from the violating transaction. Those penalties must be paid into the general fund of the Treasury. The bill also prevents deduction of losses from illegal prediction market trades on federal income tax and bars payment of penalties from certain official allowances, Senate/House office accounts, or campaign contributions.

What it means for you#

• If you are a covered official (Member of Congress, judge, President, Vice President, high-level executive official, or a covered candidate): you must not own or trade most individual stocks, commodities, futures, or derivative positions that are defined as "covered investments," unless you divest them or place them in a qualified blind trust within 90 days. You also may not trade prediction market contracts tied to political or government events.
• If you are a spouse or dependent child of a covered official: you are generally also covered when defined as a covered official; a spouse or dependent may trade a covered investment only when that trade is part of their primary occupation and the covered investment is not owned by the covered official.
• If you are a member of the public or an investor: the bill does not change ordinary access to markets but places new restrictions and reporting and penalty rules on certain federal officials and their close family.

Expenses#

No publicly available information on federal cost estimates or budgetary effects is included in the bill text. The bill directs that fines collected under the penalties section be deposited into the general fund of the Treasury.

Proponents' View#

No publicly available information on proponents' arguments or supporting statements is included in the bill text provided.

Opponents' View#

No publicly available information on opponents' arguments or opposing statements is included in the bill text provided.