Attorney Debra D'Agostino Comments on Possible Trump Administration STOCK Act Violations
Posted By The Federal Practice Group Worldwide Service || 1-Dec-2016
Over the last few weeks, we have seen President-elect Donald Trump select a number of remarkably wealthy and seasoned financial investors as members of his Cabinet and sub-Cabinet. Government Executive turned to federal employment attorney Debra D'Agostino for insight into whether or not the 2012 STOCK Act may dissuade some of these investors from accepting a White House position.
The Stop Trading on Congressional Knowledge ("STOCK") Act was put in place to prevent federal employees from insider trading. Since 2012, however, the law has seen a number of revisions that limit the scope and specificity of its restrictions. Because of these changes, Attorney D'Agostino remains skeptical whether or not any investor entering the new administration's Cabinet will take the law seriously.
"I can’t fathom how this is going to deter anyone from much of anything since disclosure is not really enforced," she told Government Executive. Experts agree that the original draft of the law would pose a serious issue for some investors, but now that it’s been blunted, even the Obama Administration seems to have deprioritized enforcement.
Attorney D'Agostino reiterated, however, that an assumed lack of enforcement does not mean that serious complications are unlikely to arise. "[The STOCK Act] offers very little guidance on how insider trading laws for disclosure in the financial world apply to the government world," she explained. "In this day and age when the president tweets, what is the line between public and private information? It’s difficult for the SEC to determine what piece of information or proof was material to any trade."
She also points out the President-elect himself has yet to take precautions to prevent financial conflicts of interest-- such as setting up a blind trust for his assets. "It would be hard for the public to expect those below him to adhere to higher standards than he is holding himself to," she said. "We’re in uncharted territory."
You can read more of Attorney D'Agostino's insight in "Trump's Top Nominees Unlikely to Be Deterred by STOCK Act" at the Government Executive site.