Campaign Event Contract Integrity Act
- Sponsor
- Rep. Torres, Ritchie [D-NY-15]
- Committees
- Agriculture Committee (primary)
- Last action
- Jun 15, 2026
Bottom line
The bill aims to prevent insider trading on political prediction markets by campaign insiders, enhancing market integrity and public trust in political outcomes.
What it actually does
This bill prohibits individuals affiliated with political campaigns from trading in political event contracts (prediction markets) while possessing confidential, nonpublic campaign information. It also mandates that platforms facilitating such trading establish safeguards to prevent insider trading and market manipulation, and requires traders above certain thresholds to disclose campaign affiliations. The Commodity Futures Trading Commission (CFTC) is granted enforcement authority.
Proponents argue
Proponents argue that this bill is essential to maintain the integrity of political prediction markets and prevent unfair advantages. They contend that allowing individuals with privileged campaign information to profit from that knowledge erodes public trust in both financial markets and the political process, creating an uneven playing field and potentially incentivizing unethical behavior. Ensuring fair play in these markets is seen as crucial for their legitimacy.
Opponents contend
Opponents might argue that the bill could be overly broad, potentially stifling legitimate political analysis or free speech by creating a chilling effect on individuals who might have tangential connections to campaigns. They may also raise concerns about the practical challenges of defining and enforcing 'material nonpublic campaign information' in the fluid political landscape, and the potential for regulatory overreach by the CFTC into political activities.
The bill is concise and clearly written, making it accessible for an informed reader to understand its core provisions and implications within a short timeframe.
Section 2
Definitions of Key Terms
This section establishes the core definitions for the bill, including 'covered campaign-affiliated individual,' 'covered platform,' 'material nonpublic campaign information,' and 'political event contract.' These definitions are crucial for determining the scope of the prohibitions and requirements outlined in subsequent sections, broadly encompassing campaign staff, consultants, and their immediate family members, as well as various types of confidential campaign data and political prediction market instruments.
Supporters argue
Supporters argue that precise and comprehensive definitions are necessary to ensure the bill's effectiveness in preventing insider trading. They contend that broad definitions, particularly for 'campaign-affiliated individual' and 'material nonpublic campaign information,' are vital to close potential loopholes and ensure that the spirit of the law is upheld.
Critics contend
Critics might argue that some definitions, such as 'covered campaign-affiliated individual' including immediate family members or 'material nonpublic campaign information' including a broad range of internal data, could be overly expansive. This could lead to unintended consequences, such as chilling legitimate political discourse or making compliance unduly burdensome for individuals and platforms.
Tradeoffs
The tension lies between creating a comprehensive framework to prevent insider trading and avoiding overreach that could inadvertently impact legitimate activities or create excessive compliance burdens. Balancing specificity with flexibility for future market developments is also a challenge.
Section 3
Prohibition on Insider Trading and Tipping
This section directly prohibits covered campaign-affiliated individuals from buying, selling, or trading political event contracts while possessing material nonpublic campaign information. It also forbids these individuals from sharing such information with others if it's reasonably foreseeable that the information will be used for trading. Furthermore, it prohibits any person from trading on behalf of or for the benefit of a campaign-affiliated individual to evade the Act.
Section 4
Platform Safeguards and Disclosure Requirements
This section mandates that covered prediction market platforms establish and maintain policies and procedures to detect and prevent prohibited trading, identify suspicious activity, and monitor concentrated trading. Platforms must also require traders exceeding certain thresholds to disclose any affiliation with federal campaigns or access to material nonpublic campaign information. The CFTC is tasked with promulgating rules to implement these requirements within 180 days.
Section 5
Enforcement Authority and Penalties
This section grants the Commodity Futures Trading Commission (CFTC) the authority to investigate violations of the Act and bring civil enforcement actions. Individuals found in violation are subject to civil penalties up to the greater of $250,000 or three times the profit gained/loss avoided, disgorgement of profits, and temporary or permanent trading bans. The CFTC can also refer evidence of willful misconduct or criminal violations to the Attorney General.
Section 6
Safe Harbor Provisions
This section clarifies that the Act does not prohibit several activities, including lawful political analysis based solely on publicly available information, journalism, academic research, public commentary, or trading by individuals without access to material nonpublic campaign information. It also states that the Act does not prohibit the lawful operation of political event contracts otherwise permitted under Federal law.
The definition of 'covered campaign-affiliated individual' includes 'any immediate family member acting on behalf of such individual.'
Section 2(1)
Why it matters:This is a standard legislative practice to ensure comprehensive coverage and prevent evasion by proxy. It's not necessarily evasive, but it significantly broadens the scope of individuals subject to the trading prohibitions.
Case for: Proponents argue that including immediate family members is essential to prevent individuals from using proxies to circumvent the insider trading prohibitions. Without this inclusion, a campaign insider could easily pass information to a family member to trade on their behalf, undermining the entire purpose of the Act.
Case against: Critics might argue that this broadens the scope of the Act significantly, potentially impacting individuals who have minimal direct involvement with a campaign. It could create difficulties in enforcement and compliance, especially in determining when a family member is 'acting on behalf of' the affiliated individual.
Estimated impact: Significantly expands the universe of individuals subject to the trading prohibitions, potentially by thousands across various campaigns and political entities.
The definitions of 'material nonpublic campaign information' and 'political event contract' include catch-all clauses allowing the Commodity Futures Trading Commission (CFTC) to designate 'any other confidential campaign information' or 'any other political or governmental event' by rule.
Section 2(3)(J) and Section 2(4)(G)
Why it matters:This is a common legislative technique to grant regulatory agencies flexibility to adapt to future developments or unforeseen circumstances without requiring new legislation. It's standard practice for dynamic areas but represents a significant delegation of authority.
Case for: Proponents argue that these clauses are vital for the bill's long-term effectiveness, allowing the CFTC to adapt to evolving campaign strategies, new forms of confidential information, or novel political event contracts that may emerge. This prevents the law from becoming quickly outdated.
Case against: Critics might express concern about the broad delegation of rulemaking authority to the CFTC, arguing it could lead to regulatory overreach or uncertainty. They may contend that such significant expansions of scope should be explicitly legislated by Congress rather than left to agency discretion.
Estimated impact: Grants the CFTC significant power to expand the scope of regulated information and events, potentially impacting a wider range of political activities and prediction markets than initially specified in the bill.