The Campaign Legal Center (CLC) alleges that Representative Bobby Scott (D-VA-03) may have failed to file periodic reports disclosing up to $60,000 in stock transactions. On Wednesday, the CLC filed a complaint with the House Office of Congressional Ethics (OCE) requesting an investigation into possible violations of the Stop Trading on Congressional Knowledge (STOCK) Act.
“In 2019 and 2020, Rep. Scott appears to have purchased at least four assets with a total value ranging from approximately $4,004 to $60,000 without disclosing the transactions. While Rep. Scott disclosed the ownership of these assets on his annual financial disclosures, he did not file periodic transaction reports (‘PTRs’) for the transactions that resulted in the changes in his stock holdings, as required pursuant to the STOCK Act and House rules. An OCE investigation is necessary to determine whether his failure to file was a violation,” the complaint states.
There is a potential explanation for the lack of a periodic report, due 45 days after a transaction, according to the CLC complaint. The reports aren’t necessary if the value of the initial stock purchase was below a $1,000 threshold. If the stock is then appreciated above that threshold, that could lead it to appear on an annual report without a periodic report filing.
“To know whether this exception applies, an OCE preliminary review is needed to determine the value of each of Rep. Scott’s initial transactions,” the CLC states.
The CLC began looking at STOCK Act violations after multiple legislators from both parties traded stocks just before the market crashed due to COVID-19 in spring 2020.
The complaint is one of seven announced Wednesday against legislators who allegedly failed to file PTRs. The other legislators are Representatives Cindy Axne (D-IA-03), Warren Davidson (R-OH-08), Lance Gooden (R-TX-05), Thomas Suozzi (D-NY-03), Roger Williams (R-TX-25), and Delegate Michael San Nicolas (D-GU.)
Previously the CLC has filed complaints against six other members who filed late or improperly. Some of the transactions alleged in both sets of complaints were higher, ranging into millions of dollars in some cases.
According to the CLC, by not filing the periodic reports, legislators defeat the purpose of the STOCK Act, avoiding real-time disclosure of potential conflicts of interest.
“If members are not held accountable for failing to file PTRs, many will continue to wait until their annual financial disclosures to reveal stock trades and pay nominal late fees, thereby circumventing the STOCK Act,” the CLC complaint states. “When members of Congress trade individual stocks and fail to disclose those trades, they break the law and diminish the public’s trust in government. The recent prevalence of STOCK Act violations in the House shows that merely the threat of a fine is not deterring members of Congress from breaking the law; real accountability is necessary.”
Even after the CLC files complaints, follow-up is difficult.
CLC Senior Communications Manager Brendan Quinn said that OCE investigations aren’t made public, and the only way the CLC knows the results of its complaints is if the individual members disclose to the press that they were fined.
“Some of those members care enough about transparency to let members of the press know. They don’t have to,” Quinn said.
He said the OCE is set up to provide some autonomy from the House, but there’s no similar office overseeing the Senate. As a result, Quinn said the CLC has seen more ethics enforcement in the House than the Senate.
“It’s just the Senate Ethics Committee overseeing that, so it’s members of the Senate overseeing each others’ ethics,” Quinn said.
“We’re pushing because of the 13 members that we filed against this year, 11 were members of the House,” he said. “We’ve seen nothing in the Senate, because there is no OCE in the Senate. And it’s two of the thirteen we filed against, but it’s two members of the Senate, of a 100-member body, that have questionable stock trading issues.”
Scott’s office did not respond to a request for comment.
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