Lessons from the Insider Trading Prohibition Act After Its Likely Demise In the Senate
For a moment there, it really looked like it was going to happen. After a long and winding road, insider trading reform had reached the floor of the House of Representatives for a vote. But then the Insider Trading Prohibition Act (ITPA) went to the Senate and vanished. What lessons we can learn toward fashioning the best possible legislation next time?.
August 14, 2020 at 03:45 PM
8 minute read
This article appeared in Business Crimes Bulletin, an ALM/Law Journal Newsletters publication that features the news and analysis you need to stay on top of the fast-changing, multi-faceted world of financial and white-collar crime.
For a moment there, it really looked like it was going to happen. After a long and winding road, insider trading reform had reached the floor of the House of Representatives for a vote. The Insider Trading Prohibition Act (ITPA) had support on both sides of the aisle. Learned professors had testified about the need for action. Past and present commissioners from the Securities and Exchange Commission had weighed in on the merits of the bill. Proponents from all sides of the criminal justice system called for the need for greater clarity in insider trading regulation and enforcement. On Dec. 5, 2019, the House voted to pass the ITPA with 410 yeas against only 13 nays. The hour was at hand.
Then the bill went to the Senate and vanished. It was referred to the Committee on Banking, Housing, and Urban Affairs in December and has never been seen since. By all accounts, insider trading reform is likely a dead letter for the foreseeable future.
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