Stop Corrupt Trading Act
- Sponsor
- Rep. Salinas, Andrea [D-OR-6]
- Committees
- Judiciary Committee (primary)
- Last action
- Aug 6, 2026
Bottom line
This bill aims to prevent the President, Vice President, and related entities from profiting from nonpublic information gained through their official positions, extending prohibitions to those who would acquire such information, thereby enhancing government ethics and transparency.
What it actually does
This bill prohibits the President, Vice President, and entities they control or have a significant financial interest in from selling or exchanging nonpublic information for financial benefit. It also makes it illegal for any other person to acquire, purchase, sell, or exchange such nonpublic information for financial benefit. The bill establishes both criminal penalties, including fines and imprisonment, and civil enforcement mechanisms, such as disgorgement of profits and civil penalties.
Proponents argue
Proponents argue this bill enhances public trust in government by closing potential loopholes that allow high-ranking officials to profit from their positions. They contend it promotes transparency and ethical conduct, ensuring that official information is used for public good, not private gain, and strengthens accountability for those who abuse public trust.
Opponents contend
Opponents might argue that existing ethics laws are sufficient or that the definitions of 'nonpublic information' or 'covered entity' are overly broad or vague, potentially leading to unintended consequences or chilling legitimate activities. They might also raise concerns about the scope of criminal penalties or the potential for politically motivated investigations.
The bill is concise and can be read and understood quickly by an informed citizen, making it accessible for public review.
Section 1
Short Title
This section establishes the official short title of the Act as the 'Stop Corrupt Trading Act,' which is the common name used to refer to the legislation. This title provides a clear and concise identifier for the bill, facilitating public and legislative discourse.
Supporters argue
A clear short title helps in public discourse and legislative tracking, making the bill more accessible and its purpose immediately understandable to a wider audience.
Critics contend
No specific opposition is typically raised against short title provisions as they are procedural and do not alter substantive law.
Tradeoffs
None.
Section 2(a), adding new Section 240(a) to 18 U.S.C. Chapter 11
Definitions of 'Covered Entity,' 'Covered Person,' and 'Nonpublic Information'
This section defines key terms for the new law. A 'covered entity' includes firms or other organizations controlled by, or where a 'covered person' has a significant financial interest (5% or more). A 'covered person' is specifically defined as the President or Vice President. 'Nonpublic information' is information gained through official position, not publicly available, routinely exempt from disclosure, designated confidential, or not authorized for public release, including certain communications not available on equal terms.
Section 2(a), adding new Section 240(b) to 18 U.S.C. Chapter 11
Prohibition on Misuse of Nonpublic Information
This section establishes two main prohibitions. First, it forbids any 'covered person' (President/VP) or 'covered entity' from entering into a transaction to sell or exchange nonpublic information for financial benefit. Second, it prohibits any other person from entering into a transaction to acquire, purchase, sell, or exchange nonpublic information for financial benefit. This creates a dual prohibition targeting both the source and the recipient of misused information.
Section 2(a), adding new Section 240(c) to 18 U.S.C. Chapter 11
Criminal Penalties and Forfeiture
This section outlines the criminal penalties for violating the misuse of nonpublic information. For covered persons or entities selling information, the punishment can be a fine of up to double the transaction value (deposited in the Treasury) or imprisonment for up to 5 years, or both. For other persons purchasing or selling information, the penalty is a fine of up to double the transaction value (deposited in the Treasury). Additionally, courts must order the forfeiture to the United States of any property derived from the offense.
Section 2(a), adding new Section 240(d) to 18 U.S.C. Chapter 11
Civil Enforcement and Disgorgement
This section grants the Attorney General authority to bring civil actions against violators, independent of any criminal prosecution. Available remedies include disgorgement of all profits, civil penalties up to $250,000 or three times the gain/payment per violation, and equitable relief like injunctions or constructive trusts. The standard of proof for these civil actions is a preponderance of the evidence. A 6-year statute of limitations applies, which is tolled (paused) while the defendant or the covered person from whom the information was derived holds the office of President or Vice President. Counterparties and covered entities are made jointly and severally liable for these civil remedies. The Office of Government Ethics (OGE) is mandated to refer any credible evidence of violations to the Attorney General and notify the Judiciary Committees of both the Senate and House.
This provision states that a covered entity, and any person that knowingly provides anything of value in a transaction described in subsection (b) (the prohibition on misuse of nonpublic information), shall be jointly and severally liable for the civil remedies (disgorgement, civil penalty, equitable relief).
Section 2(a), adding new Section 240(d)(4) to 18 U.S.C. Chapter 11
Why it matters:This is standard legislative practice for detailing liability in complex financial transactions, ensuring that all parties involved in illicit activities can be held accountable. It is not necessarily evasive but requires careful reading to fully grasp the scope of liability.
Case for: Proponents argue this provision is crucial for effective enforcement, as it ensures that those who facilitate or benefit from corrupt transactions, even if not the primary official, are also held accountable. This broadens the deterrent effect and makes it harder to create a market for illicit information.
Case against: Critics might argue that 'knowingly provides anything of value' could be interpreted broadly, potentially ensnaring individuals or entities who had only indirect involvement or whose knowledge was limited, creating an overly punitive environment for business transactions and increasing compliance burdens.
Estimated impact: Significantly expands the scope of potential civil liability beyond the immediate covered person or entity to include any knowing participant in the prohibited transaction, increasing the legal risk for third parties.