The U.S. House of Representatives overwhelmingly passed a bill to curb insider trading by lawmakers and other government officials on Thursday, despite objections from Democrats and some Republicans that it lacked some tough measures to fight corruption.
The House voted 417-2 to pass the Stop Trading on Congressional Knowledge (STOCK) Act, even though it did not include a provision to impose new regulations on Washington insiders who collect "political intelligence" from lawmakers and sell it to Wall Street.
The Senate version passed last week included this proposal, and other measures to combat public corruption that were dropped from the bill by Republican House Majority Leader Eric Cantor.
Democrats vowed to restore these provisions when House and Senate members hash out the two bills' differences. Both chambers then must give final approval to the measure before it is sent to President Barack Obama, who has promised a swift signature.
The clean-government bill has attracted massive support during an election year in which Congress's approval ratings have been devastated by deadlocks over extending payroll tax cuts and spending measures that have nearly shut down the government in recent months.
But even a feel-good bill aimed at reaffirming the public's trust in Congress has sparked bickering over changes made by House Republicans.
Many Democrats seized upon comments by Republican Senator Charles Grassley that it was "astonishing and extremely disappointing" that the House dropped his provision to force registration of political intelligence operatives, who glean information about pending legislation from lawmakers and their staffs.
They accused Cantor of caving in to Wall Street interests by merely ordering a study of the sector.
"We are missing a large gap by leaving out the provision on political intelligence -- $100 million industry," said Democratic Representative Sheila Jackson Lee. "Yes we're going to support this legislation, but we can't get to conference soon enough to make this bill comparable and ready for the American people."
Cantor argued that the provision was too broad and its implications for civil liberties needed further study. And he said the overwhelming approval vote vindicated his approach to "improve and strengthen" the bill.
The House bill also inserted a provision to explicitly bar lawmakers and officials in federal agencies and independent regulatory bodies from gaining preferential access to initial public stock offerings.
Republicans dubbed this the "Pelosi provision," a reference to a CBS "60 Minutes" report about the husband of House Democratic leader Nancy Pelosi buying shares in Visa Inc's 2008 IPO as tougher credit card regulations were pending before Congress. Pelosi, who has denied any special access or conflict of interest, said she supported the provision.
The core portion of both the House and Senate bills require lawmakers and higher level Obama administration and agency officials to disclose their stock trades within 30 days. It also clarifies that they are subject to the same Securities and Exchange Commission rules that prohibit trading on non-public, or "insider," information.
But the House version also left out a Senate provision aimed at combating public corruption that would give more powers to prosecutors to pursue public corruption cases and ban all gifts to public officials valued over $1,000.