The Senate has curtailed a provision in the Stop Trading on Congressional Knowledge Act that forced legislative and executive staffers to disclose their finances on a public, searchable database.
The decision comes after a major grumblings from senior executives. Congress tapped the National Academy of Public Administration to take a closer look at the provision.
Dan Blair is the President and CEO of NAPA. He told Chris Dorobek on the DorobekINSIDER program that the original version of the STOCK Act did have a major purpose.
"There was a 60 minutes segment a little over a year ago that proposed that members by virtue of their positions on committee and conferences had access to information that they could use for insider trading with regards to buying and selling securities. So the President and Congress joined together and passed legislation aimed at preventing that from happening," said Blair.
So Why Are People Against the Act?
"During the debate on this bi-partisan legislation an amendment was offered and accepted that would require senior federal executives - those who are required to file SF278 financial disclosure forms - to do so online on a searchable database that the Office of Government Ethics was supposed to establish. The amendment was added with little fanfare and was signed into law by the President," said Blair
- After it was signed you started to hear these grumblings because their information would be public available on a searchable database.
- There were a bunch of concerns voiced by a wide range of current and former officials saying this amount of transparency put people at risk for national security reasons, privacy and litigation.
How Did the SES Get Involved in the First Place?
"There was a view that if members of Congress and their staffs were going to be required to have their disclosures online then the executive branch should have to undergo the same level of scrutiny and public review," said Blair.
Isn't the Information Already Public?
"We already make this information public through the Office of Government Ethics. But it is making the information public in a way that people from their garages could be searching these things and using it in ways that weren't intended. It raises some big concerns," said Blair.
Reform the Ethics System?
"Our current ethics system is 35 years old. We need a better understanding of the changing landscape, there are new threats and more complex investment types. In 1978 investment choices for individuals were much more limited then they are today. But our ethics is still grounded in the 1978 thought process," said Blair.
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