Bill Named After Nancy Pelosi Could Ban Congress Members From Trading Stocks: What You Need To Know About The 'PELOSI' Act

A bill that could ban members of Congress from buying and selling stocks and other financial assets is being reintroduced years after it made limited progress.

Here's what investors should know about the "PELOSI" act.

What Happened: Senator Josh Hawley (R-Mo.), who does not buy and sell stocks according to Benzinga's Government Trades page, reintroduced legislation that would ban members of Congress from trading or holding individual stocks.

The bill is known as the Preventing Elected Leaders from Owning Securities and Investments Act, or PELOSI Act based on the first letter of each of the main words. The name takes aim at Congresswoman and former Speaker of the House Nancy Pelosi (D-Calif.).

Pelosi, whose husband Paul Pelosi is a venture capitalist, has been one of the most watched members of Congress when it comes to stock and options trades given the size and timing of several of the buys and sells.

"Members of Congress should be fighting for the people they were elected to serve — not day trading at the expense of their constituents," Hawley said. "Americans have seen politician after politician turn a profit using information not available to the general public."

Hawley said the bill will help "restore Americans' trust in our nation's legislative body."

Under the terms of the bill, lawmakers and their spouses would not be allowed to buy, sell or hold individual stocks or options. The lawmakers would be given 180 days to comply with the legislation. Members of Congress could invest in diversified mutual funds, ETFs and U.S. Treasury bonds while in office.

Failure to comply would result in fines if the bill is passed and signed into law.

Why It's Important: With ongoing debates about potential conflicts of interest in congressional trading, Representative Ro Khanna (D-Calif.) previously told Benzinga he would continue advocating for a congressional vote to ban the practice.

“We should have a vote on it,” Khanna told Benzinga.

Khanna said that despite his continued speeches in the House advocating for a ban on stock trading, there is a "collective shrug" in Congress regarding the issue.

“It is shameful that over three years after the [COVID-19] pandemic with the shenanigans from those senators who sold their stock after learning of the pandemic, there still hasn’t been a vote,” Khanna said.

Members of Congress are currently allowed to buy and sell stocks and options as long as they properly disclose the transactions within 45 days.

Multiple transactions have been flagged by Benzinga and other outlets that point to potential conflicts of interest over the timing of the trades.

Hawley's bill is being reintroduced as President Donald Trump said he would support such a ban.

"Well, I watched Nancy Pelosi get rich through insider information, and I would be okay with it. If they send it to me, I would do it," Trump told TIME.

Trump said he would sign the ban if the bill passes Congress.

In December, outgoing President Joe Biden also endorsed a ban on Congress trading.

“Nobody in the Congress should be able to make money in the stock market while they’re in the Congress,” Biden said in an interview with political advisor Faiz Shakir.

There are currently several websites that track congressional trading activity, with members of Congress often times having better stock returns than the average S&P 500 fund. There are also several ETFs including the Unusual Whales Subversive Democratic Trading ETF NANC and the Unusual Whales Subversive Republican Trading ETF GOP that offer investors exposure to trades made by members of Congress.

While Pelosi makes headlines for her trades, it's important to remember that it is both Republican and Democratic members of Congress who are profiting from buying and selling stocks and options while in office, with some trades coming with questionable timing or having a connection to committees they serve on.

In 2024, a list of the top-performing traders in Congress included six Republicans and four Democrats.

Hawley's bill does not mention cryptocurrency like Bitcoin BTC/USD, with several members of Congress buying Bitcoin and Bitcoin ETFs over the last year as the U.S. looks to establish a Bitcoin Strategic Reserve.

There are currently low odds of the PELOSI Act passing Congress this year. On prediction market Polymarket, there is only a 17% chance that Congress stock trading is banned in 2025. On Monday, the odds stood at 22%.

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