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Insider Trading Running Rampant in D.C.?

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    Former Rep. Brian Baird on the investing loopholes that exist on Capitol Hill.

  • Duration 4:43
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Insider trading is criminal act to just ask Roger -- Roger rod -- they hedge fund manager -- sentenced to eleven years in jail for that but.

Insider trading is not a crime in the halls of congress are lawmakers are allowed to invest on market moving information that nobody else knows about.

This from a sixty minutes report last night.

They're all sorts of forms of honest crafts.

The congressman engaging that allow them to become very very wealthy so it's not illegal but I think it's highly unethical I think it's highly offensive and wrong what do you mean -- -- -- for example -- insider trading on the stock market if you are member of congress those laws are deemed to not to apply.

So congressman get a pass on insider trading they do.

Former democratic congressman Brian Baird of Washington State for years tried to stop this -- -- thing.

Only to be ignored by his colleagues he joins us now from the Seattle mr.

Baird good to see it now as I did.

What they are doing trading on inside information I would be arrested and possibly sent to jail correct.

Indeed it's happened to members of the media it's happened and members of the executive branch and surely it's happened -- corporate people they all.

Operate under rules that unfortunately don't apply -- my colleagues in congress.

And it's exactly where we're not to -- hedging year we're not try to stretch a point it's exactly the same kind of information that they do.

-- or any other civilian out there -- be arrested for.

Well it's a very subtle difference but that -- the issue is this do we have a duty to a corporation which is the standard rule.

For insider trading while members of congress are part of the corporation.

So attorneys have said well therefore -- the standard rules don't apply to you.

My premise is they should apply we are privy in congress the information.

Far more valuable often than what corporate insiders -- and yet if we make personal trades -- give the information to somebody else.

We're not subject to SEC well and of course there's the other side of that that the -- like -- aside to that which is that.

They take actions that can affect the stocks that they're traded not directly.

Well indeed you know there are two ways you can go about it you can steer.

Your legislation to your investments or you can steer your investment -- legislation either way is wrong.

And but apparently both have been happening and they ought to be fixed out Nancy Pelosi is is featured was featured in the sixty minutes piece because.

She made -- trade and involve something she was voting on -- deciding not let's just take a look at the clip and I wanna get your response.

You've participated in the IPO.

And a daytime viewers idea of the house you don't think there's a conflict of interest or have the apparently unplanned -- that would carry has its parents if you decide that you -- going to.

Have.

Elaborate on a false premise.

But it's it's it's not true.

And that's that.

-- right now.

Most of us can't operate on I'd trade on an IPO when it went as she was able to.

And and going through congress at that time that she bought the -- stock was legislation that did affect credit card companies and eventually.

I was kind of table so one can make the connection -- they I mean you don't have to be a conspiracy -- to do that.

Well I think it's also fair leader Pelosi certainly led some efforts to try to rein in some of the corporate -- as you pointed out right it.

But the appearance of impropriety you know that this CBS program.

Covered also speaker -- apparently diverting and earmark for transportation project to his own property.

The example of Spencer Bachus getting a classified confidential briefing about the state of the financial markets and going from there.

To to buy stock options these are just unconscionable in my mind then and they out and -- I don't really understand how people don't see.

Both the appearance of impropriety in the actual liberal I do know.

I I I think most people if they sell it out as clearly as you just did would see the impropriety of -- by the way you're talking about that 2008.

Secret meeting between treasury and fed officials and members of congress that essentially said the world is about to come to an end.

And after that meeting they got rid of a lot of their stock right.

Yeah indeed you know if you're if you're the ranking member chairman of the financial service committee and the chairman of the Federal Reserve.

And the secretary of the treasury say there is about to be a massive global collapse.

First thing on your mind should be how do we prevent this how do we keep it from harming our citizens.

Not -- -- better rush element to call my broker which seems to be what mr.

-- did an anomaly apparently in that case alone.

Extraordinary by the -- not that it matters but -- Democrat in congress correct.

I was in the -- were indeed all right but I I would assume that this is somebody get bipartisan support Brian Baird thank you very much for coming in sir appreciate it.

Thank you it should be bipartisan it should.

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