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HR310FEDERALFederal Billin committee

High Impact

The DIVEST Act: Restricting Financial Investments for Senior Federal Employees

Original title: Dismantling Investments in Violation of Ethical Standards through Trusts Act

Last action · January 12, 2023: Referred to the Committee on Oversight and Accountability, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.Sponsor: Michael Cloud

Bill progressHistory & official text ↓

Introduced

Committee

Floor Vote

Passed

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What This Bill Would Do

This bill prohibits senior federal employees, their spouses, and their dependent children from holding, buying, or selling certain financial instruments like stocks, commodities, and derivatives. It requires annual compliance certifications and mandates that profits from prohibited holdings be paid to the U.S. Treasury.

Why it matters

This bill would restrict the personal investment portfolios of high-level federal officials to prevent potential conflicts of interest, requiring them to divest prohibited assets within 180 days of starting their service.

Who It Would Affect

Groups the bill's text would affect if enacted, as described in the record. Being affected is not a position for or against it.

Directly affected

Senior Federal Employees

They are subject to new restrictions on personal financial holdings and must submit annual compliance certifications.

Directly affected

Spouses and dependent children of senior federal employees

They are prohibited from holding or trading certain financial instruments while the employee is in service.

Key Facts

Prohibits senior federal employees, their spouses, and dependent children from holding, purchasing, or selling 'covered financial instruments' during the employee's term of service.
Covered financial instruments include stocks, security futures, commodities, and synthetic derivatives.
Excludes diversified mutual funds, diversified exchange-traded funds (ETFs), U.S. Treasury securities, and compensation from a spouse's or dependent's primary occupation.
Allows a 180-day grace period for divestment for both current employees and new hires.

Show all 12 facts

Permits holdings in qualified blind trusts.
Requires profits from prohibited transactions to be disgorged (paid) to the U.S. Treasury general fund.
Prohibits tax deductions for losses incurred from prohibited transactions.
Requires senior employees to submit annual written certifications of compliance to their supervising ethics office.
Mandates that compliance certifications and details of any assessed fines be published on a public website.
Sets civil fines for violations at the greater of $1,000 or 10% of the highest value of the prohibited instrument held.
Requires the Government Accountability Office (GAO) to audit compliance within 2 years of enactment.
Provides an appeals process for employees assessed with civil fines.

Frequently Asked Questions

Does this bill ban all investments for senior federal employees?

No. It specifically bans 's' like individual stocks, commodities, and derivatives. It explicitly allows diversified mutual funds, ETFs, and U.S. Treasury bonds.

What happens if a senior employee violates these rules?

They must pay any profits from the prohibited transaction to the U.S. Treasury, they cannot claim tax deductions for any losses, and they may face civil fines of at least $1,000 or 10% of the asset's value.

Are spouses and children included in these restrictions?

Yes. The restrictions apply to the senior federal employee, their spouse, and their dependent children.

What else do you want to know?

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Where This Stands

Currently in committee. The next step in the legislative lifecycle is Floor Vote.

Last action

Referred to the Committee on Oversight and Accountability, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned.Jan 12, 2023

Version history

Only one version on file - nothing to compare yet. As later stages (committee substitute, engrossed, enrolled) are captured, the redline appears here.

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Full breakdown

Who this bill affects and the strongest case for and against it, written only from the bill’s own text.

Discoveries

1 pattern noticed across the record

Patterns POLISCOPE noticed across the record. These are observations to investigate, not conclusions.

policy shift90% confidence

Expansion of Ethics Oversight

The bill moves beyond simple disclosure requirements to active prohibition of asset classes for senior staff.

Senior Federal Employees

Connected Entities

Committee on Oversight and Accountability, Mr. Cloud, House Ways and Means Committee and 2 more

OrganizationCommittee on Oversight and Accountability“Committee assigned to review the bill.”Map →

PersonMr. Cloud“Representative who introduced the bill.”Map →

OrganizationHouse Ways and Means Committee“Committee assigned to review the bill.”Map →

PersonMr. Golden of Maine“Representative who co-sponsored the bill.”Map →

OrganizationGovernment Accountability Office“Tasked with auditing compliance.”Map →

Sources

Open source document

www.congress.gov

Analysis Score

0–100

Significance85
How much this matters to a regular citizen
Controversy60
Intensity of disagreement among stakeholders
Entertainment20
Compellingness for a non-policy-wonk reader
Buzz40
Current news / social attention level

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