Concerns Over Stock Market Double Standards and Insider Trading by Congress
  1. United States
  2. Wisc.
  3. Letter

Concerns Over Stock Market Double Standards and Insider Trading by Congress

To: Sen. Baldwin, Sen. Johnson, Rep. Pocan

From: A constituent in Waunakee, WI

June 7

I am writing to express my deep concerns over the disproportionate scrutiny and enforcement actions targeting regular household investors for making routine stock market trades, while members of Congress appear to be exploiting their access to inside information to make lucrative, market-beating trades. As a constituent, I am troubled by reports that ordinary investors are facing aggressive oversight and even prosecution for relatively minor issues like failing to properly report capital gains or making trades that regulators deem too frequent. Meanwhile, investigations have revealed that numerous Senators and Representatives are using their positions of power to gain unfair advantages in the stock market, often timing their trades based on non-public information and privileged access to industry leaders and policymakers. For example, reports have shown that certain members of Congress made suspiciously well-timed trades in certain healthcare and technology stocks just weeks before major policy announcements that impacted those industries. Similarly, other Representatives were found to have executed options contracts that netted significant profits just prior to a major geopolitical development that moved global markets. These examples highlight the blatant double standard at play. I am also deeply troubled by the widespread reports of illegal short selling and naked short selling tactics employed by large market makers. These predatory practices allow powerful players to artificially depress the prices of certain stocks, often those favored by retail investors, in order to generate profits at the expense of hardworking Americans. This further undermines the fairness and integrity of the stock market. This stark double standard is profoundly unfair and breeds a deep sense of mistrust in our financial markets and elected institutions. Household investors like myself are simply trying to build wealth and plan for the future, while our elected officials appear to be prioritizing their own financial interests over their duties to the public. I urge you, as my representative, to take immediate action to address these egregious imbalances. This could include: Pushing for stricter rules and enforcement around insider trading by members of Congress, with clear and consistent penalties. Ensuring that retail investors face proportionate, fair oversight that does not disproportionately target ordinary people engaging in normal investment activities. Advocating for greater transparency around the stock trades of elected officials and their immediate family members. Cracking down on illegal short selling and naked short selling practices that unfairly target certain stocks and investors. The faith of the public in our democratic institutions are at stake. I hope I can count on you to champion reforms that create a level playing field and restore trust in the system. Thank you for your time and attention to this critical issue.

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