On Friday, House Minority Leader Kevin McCarthy (R-Calif.) slammed Speaker Nancy Pelosi (D-Calif.) over reports that Democratic lawmakers are planning to introduce a ban on lawmakers trading stocks next month.
McCarthy said at a press conference on Friday that it is not “proper” for Pelosi to write the bill prohibiting congressional lawmakers from trading in stocks, citing investments made by her husband, Paul Pelosi, a venture capitalist. According to Insider, Paul Pelosi’s financial transactions have provided the couple with the vast majority of their wealth.
“I think we have to do a thorough investigation and look at what is the proper role for members of Congress and what influence they have,” McCarthy told reporters. “I don’t think the proper way to do this is Nancy Pelosi writing the bill because we have proven that she can’t do that.”
On Tuesday, Pelosi signed a periodic transaction report revealing that her husband had sold up to $5 million in Nvidia stock. The transaction resulted in a $341,365 loss, according to the document. On July 14, a separate periodic transaction report signed by the speaker revealed that her husband exercised 200 Nvidia call options that month.
The stock sale document was released one day before the Senate passed a chip and science bill, which the House approved the next day.
When asked about the decision to sell the holdings around the time of the House vote, Pelosi spokesperson Drew Hammill told The Hill in a statement that Paul Pelosi purchased Nvidia stock options over a year ago and exercised them on July 17.
“As is customary, he does not discuss these matters with the Speaker until trades have been completed and required disclosures have been prepared and filed.” Mr. Pelosi chose to sell the shares at a loss rather than continue to spread misinformation about the trade,” Hammill added.
According to Punchbowl News, House Democrats plan to unveil a framework in August that will prohibit lawmakers, their spouses, and senior staff from trading stocks and require them to either divest completely or place their investments in a qualified blind trust. According to sources close to the situation, individuals subject to the bill would still be able to invest in mutual funds.
McCarthy suggested on Friday that Pelosi may have shared information about the chips bill with her husband, though he admitted that he didn’t know for sure.
“Look, I believe the Speaker of the House has more say over what goes to the floor and what comes out of committees, and her husband didn’t just trade stock; he traded options.” McCarthy stated, “I believe what her husband did was wrong.”
“When she said she never told him anything, I know they spent time together overseas, and when they returned, I’m sure she had phone conversations about what was going to be on the floor.” I’m sure she had discussions about what the final chip version looked like. I’m sure she had those conversations; I’m not sure if he could hear them or not, but I believe we need to rebuild trust in this institution,” he added.
McCarthy stated that if Republicans win control of the House in November and he becomes Speaker, he will “look all the way through” legislation prohibiting lawmakers from trading stocks. According to the minority leader, he only owns mutual funds and not stocks.
“As I’ve told everyone, we will return and not only investigate this, but we will also return with a proposal to change the current behavior,” he added.
Pelosi was contacted by The Hill for comment on McCarthy’s remarks.
This year, lawmakers in both the House and Senate introduced bills to prohibit members of Congress from trading stocks, but none of them have taken off.
Pelosi initially opposed a ban on lawmaker stock trading, arguing that members of Congress should be allowed to participate in the “free-market economy.”
However, in January, she reversed her position, with multiple sources reporting that the Speaker instructed the House Administration Committee to begin drafting legislation.