In a bipartisan effort, Senators Jon Ossoff (D-Ga.), Gary Peters (D-Mich.), Jeff Merkley (D-Ore.), and Josh Hawley (R-Mo.) have introduced a new bill aimed at imposing penalties on members of Congress and their families for trading stocks. The legislation, announced on Wednesday, would prohibit lawmakers from buying and selling stocks and certain other investments. Additionally, similar restrictions would be placed on lawmakers' spouses and dependent children by 2027.

Under the proposed legislation, lawmakers found in violation of the new rules could face a fine equivalent to their monthly salary or 10 percent of the value of each improper investment. The fines, which could exceed $10,000, aim to deter members of Congress from engaging in financial activities that may conflict with their official duties.

The bill aims to address concerns around conflicts of interest, ensuring that decisions made by federal elected officials are in the best interest of the American public rather than their personal finances. Currently, lawmakers are already prohibited from using confidential briefings to make investments, and they must disclose publicly the stocks they buy and sell. However, the current penalty for violations is a mere $200, significantly lower than most members of Congress' annual salary of $174,000.

The rise in congressional stock trading has led to the launch of investment products that allow ordinary investors to mirror the trades made by lawmakers. The new legislation seeks to alleviate conflicts of interest while still allowing members of Congress to invest in mutual funds or pooled securities, such as exchange-traded funds (ETFs).

While previous bipartisan attempts to ban or restrict congressional stock trading have failed, the sponsors of this bill express optimism about its prospects. They are hopeful that Senate Majority Leader Charles E. Schumer (D-N.Y.) will bring the measure for a vote before the full chamber in the coming months. Additionally, there is potential interest in a stock-trading ban from Republican leadership in the House.

However, the legislation might face obstacles in the Senate, given that it would require 60 votes to overcome a potential filibuster. Nonetheless, Senator Hawley believes that many of his Republican colleagues, who campaigned on banning stock trading, would support the measure.

Lawmakers who have faced scrutiny over their stock trades in recent years have not faced significant consequences. For instance, Rep. Pat Fallon (R-Tex.) failed to disclose numerous transactions valued between $9 million and $21 million in a timely manner but only paid $600 in late-filing fees without further disciplinary action.

The proposed legislation aims to hold lawmakers accountable for their financial activities and restore public confidence in the decision-making process. If passed, it could represent a significant step in addressing concerns about conflicts of interest within Congress.