Congress Must Divest or Blind-Trust Investments Within 120 Days Under New Ethics Bill

The “Good Government Act of 2025” is aiming to tackle a conflict of interest issue that has been in the news for years: Members of Congress trading stocks while writing the laws that affect those very companies. This bill says, flat out, that Members of Congress, their spouses, and their dependent children cannot hold, buy, or sell most individual stocks, security futures, or commodities during the Member’s term of service. The main goal is to wall off lawmakers from using their insider knowledge for personal financial gain, which is a big deal for public trust.

The 120-Day Clock: Divest or Trust

If this bill passes, any sitting Member who owns these "covered financial instruments"—which basically means individual stocks—has a tight deadline. Within 30 days of the law taking effect, they have to tell the ethics office what they own and how they plan to handle it. Then, they have only 120 days to either sell those assets (divest) or place them into a qualified blind trust. A qualified blind trust is a specific type of trust approved by the ethics office where the Member has zero control over the investment decisions. For new Members coming into office, the same 30/120-day clock starts ticking the day they begin service. This is a strict timeline; if they can't meet it, they can ask for extensions, but the total extension period for any single asset can’t exceed 180 days.

What’s Out and What’s In

It’s important to know what the bill doesn't cover. Lawmakers can still hold diversified mutual funds or Exchange Traded Funds (ETFs), as well as U.S. Treasury bills, notes, or bonds. They can also keep investments held in government employee retirement plans. This means they aren't completely banned from investing; they just have to stick to broad, diversified funds where they aren't picking individual winners and losers. For example, a spouse working in tech can still receive their compensation, even if it’s in stock, but if that stock is held for investment purposes, it must go into the blind trust or be sold.

The Cost of Compliance

While the intent is solid, the strict 120-day deadline could create real-world financial pressure. Imagine a Member or their spouse owns stock in a small business they helped build, and the market is down when the deadline hits. They are forced to sell or transfer the asset into a blind trust at a potentially bad time, locking in a loss simply to comply with the new rule. This is the practical trade-off: preventing conflicts of interest by forcing asset sales or transfers that might not be financially optimal for the individual.

Transparency and Escalating Penalties

This bill has teeth, especially regarding transparency and enforcement. The ethics offices must publicly post all compliance certifications, blind trust agreements, and even details about any extensions granted. This means the public can directly check who is complying and how. If a Member fails to meet a deadline or violates the rules, the ethics office must issue a notice. If the violation isn't resolved, the penalty kicks in: a civil fine equal to the monthly equivalent of the Member’s annual salary. This penalty is imposed 30 days after the initial notice and then every 30 days thereafter until the Member complies. That’s a serious financial incentive to follow the rules. Plus, any profit gained from an illegal transaction must be paid back to the U.S. Treasury. Finally, the restrictions don’t end when they leave office; Members, spouses, and dependents cannot dissolve a qualified blind trust or regain control of those assets until 180 days after the Member leaves office, ensuring a cooling-off period.