Bipartisan Act Bans Members of Congress from Trading Stocks: 90-Day Deadline to Sell or Trust Assets

The Bipartisan Restoring Faith in Government Act introduces a sweeping ban on Members of Congress, their spouses, and their dependent children from owning or trading individual stocks, commodities, and derivatives. Under the new rules, these individuals are prohibited from holding 'covered financial instruments,' which includes everything from tech stocks to complex options and futures. To keep things clean, the bill allows for a few exceptions: lawmakers can still invest in widely held mutual funds, U.S. Treasury bonds, and the government’s Thrift Savings Plan. The goal is to ensure that those making the laws aren't also betting on the companies those laws affect.

The 90-Day Divestiture Sprint

For lawmakers currently holding a portfolio of individual stocks, the clock starts ticking immediately. Section 2 of the bill gives covered individuals exactly 90 days from the date of enactment to either sell off their banned assets or move them into a 'qualified blind trust.' These trusts are strictly regulated; the trustee cannot have a close personal or business relationship with the Member and must certify every year that no insider info was swapped. If a spouse receives stock as part of their salary at a regular job, they get a bit of a buffer—90 days from the moment they are legally allowed to sell those shares. To make this transition easier on the wallet, the bill amends Section 1043 of the Internal Revenue Code, allowing lawmakers to defer capital gains taxes on these forced sales, much like Executive Branch officials already do.

Receipts and Real-World Consequences

Transparency isn't optional under this proposal. Every Member of Congress must submit a formal 'pledge of compliance' to their respective ethics office. These offices will then issue certificates of compliance to be posted on a public website for anyone to see. If a lawmaker decides to ignore the rules, the penalties are stiff: the Attorney General can hit them with a civil fine of up to $50,000 per violation. Crucially, the bill specifies that lawmakers cannot use their office budgets or campaign funds to pay these fines—the money has to come out of their own pockets. For a family managing a complex investment portfolio, this means a total shift in how they build wealth, moving away from individual company bets and toward broad, diversified funds.

Closing the Loophole Doors

While the bill is direct, the real-world impact hinges on the 'blind' part of the blind trusts. The legislation requires that any banned instruments placed into a trust must be sold off by the trustee within six months, ensuring the Member doesn't even know what’s in there. By removing the ability to deduct losses from illegal trades on their taxes and requiring annual public certifications, the bill tries to bake accountability into the daily routine of Capitol Hill. For the average person, this means the person voting on a new tech regulation or an oil subsidy won't have a personal brokerage account that swings in value the moment the gavel hits.