I
119THCONGRESS
1
STSESSION H. R. 1599
To amend title 5, United States Code, to prohibit transactions involving
certain financial instruments by senior Federal employees, their spouses,
or dependent children, and for other purposes.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY26, 2025
Mr. C
LOUD(for himself, Mr. GOLDENof Maine, Mr. SELF, Mr. BRECHEEN,
and Mrs. C
AMMACK) introduced the following bill; which was referred to
the Committee on Oversight and Government Reform, and in addition to
the Committee on Ways and Means, for a period to be subsequently de-
termined by the Speaker, in each case for consideration of such provisions
as fall within the jurisdiction of the committee concerned
A BILL
To amend title 5, United States Code, to prohibit trans-
actions involving certain financial instruments by senior
Federal employees, their spouses, or dependent children,
and for other purposes.
Be it enacted by the Senate and House of Representa-1
tives of the United States of America in Congress assembled, 2
SECTION 1. SHORT TITLE. 3
This Act may be cited as the ‘‘Dismantling Invest-4
ments in Violation of Ethical Standards through Trusts 5
Act’’. 6
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SEC. 2. PROHIBITING TRANSACTIONS AND OWNERSHIP OF 1
CERTAIN FINANCIAL INSTRUMENTS BY SEN-2
IOR FEDERAL EMPLOYEES, THEIR SPOUSES, 3
OR DEPENDENT CHILDREN. 4
(a) I
NGENERAL.—Chapter 13 of title 5, United 5
States Code, is amended by adding after subchapter III 6
the following: 7
‘‘SUBCHAPTER IV—RESTRICTIONS REGARDING 8
FINANCIAL INSTRUMENTS 9
‘‘§ 13151. Definitions 10
‘‘In this subchapter: 11
‘‘(1) C
OVERED FINANCIAL INSTRUMENT .— 12
‘‘(A) I
N GENERAL.—The term ‘covered fi-13
nancial instrument’ means— 14
‘‘(i) any investment in— 15
‘‘(I) a security (as defined in sec-16
tion 3(a) of Securities Exchange Act 17
of 1934 (15 U.S.C. 78c(a))); 18
‘‘(II) a security future (as de-19
fined in that section); or 20
‘‘(III) a commodity (as defined in 21
section 1a of the Commodity Ex-22
change Act (7 U.S.C. 1a)); and 23
‘‘(ii) any economic interest com-24
parable to an interest described in clause 25
(i) that is acquired through synthetic 26
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means, such as the use of a derivative, in-1
cluding an option, warrant, or other simi-2
lar means. 3
‘‘(B) E
XCLUSIONS.—The term ‘covered fi-4
nancial instrument’ does not include— 5
‘‘(i) a diversified mutual fund; 6
‘‘(ii) a diversified exchange-traded 7
fund; 8
‘‘(iii) a United States Treasury bill, 9
note, or bond; or 10
‘‘(iv) compensation from the primary 11
occupation of a spouse or dependent child 12
of a senior Federal employee. 13
‘‘(2) Q
UALIFIED BLIND TRUST .—The term 14
‘qualified blind trust’ has the meaning given the 15
term in section 13104. 16
‘‘(3) S
ENIOR FEDERAL EMPLOYEE .—The term 17
‘senior Federal employee’ means any individual occu-18
pying a Senior Executive Service position (as that 19
term is defined in section 3132). 20
‘‘(4) S
UPERVISING ETHICS OFFICE .—The term 21
‘supervising ethics office’ has the meaning given the 22
term in section 13101. 23
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‘‘§ 13152. Prohibition on certain transactions and 1
holdings involving covered financial in-2
struments 3
‘‘(a) P
ROHIBITION.—Except as provided in sub-4
section (b), a senior Federal employee, their spouse, or 5
their dependent children may not, during the term of serv-6
ice of the employee, hold, purchase, or sell any covered 7
financial instrument. 8
‘‘(b) E
XCEPTIONS.—The prohibition under sub-9
section (a) does not apply to— 10
‘‘(1) a sale by a senior Federal employee, their 11
spouse, or their dependent child that is completed by 12
the date that is— 13
‘‘(A) for an employee serving on the date 14
of enactment of this title, 180 days after that 15
date of enactment; and 16
‘‘(B) for any employee who commences 17
service as an employee after the date of enact-18
ment of this title, 180 days after the first date 19
of the initial term of service; 20
‘‘(2) a covered financial instrument held in a 21
qualified blind trust operated on behalf of, or for the 22
benefit of, a senior Federal employee, their spouse, 23
or their dependent child; or 24
‘‘(3) a covered financial instrument exempted 25
from coverage under section 208 of title 18 pursuant 26
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to section 2640.202 of title 5, Code of Federal Reg-1
ulations (or any successor regulation). 2
‘‘(c) A
PPLICATION OFCERTIFICATE OFDIVESTITURE 3
P
ROGRAM.—For purposes of section 1043 of the Internal 4
Revenue Code of 1986— 5
‘‘(1) this section shall be treated as a Federal 6
conflict of interest statute; and 7
‘‘(2) any person required to dispose of any 8
property by reason of this section shall be treated as 9
an eligible person. 10
‘‘(d) P
ENALTIES.— 11
‘‘(1) D
ISGORGEMENT.—A senior Federal em-12
ployee, their spouse, or their dependent child shall 13
disgorge to the general fund of the Treasury any 14
profit from a transaction or holding involving a cov-15
ered financial instrument that is conducted in viola-16
tion of this section. 17
‘‘(2) I
NCOME TAX.—A loss from a transaction 18
or holding involving a covered financial instrument 19
that is conducted in violation of this section may not 20
be deducted from the amount of income tax owed by 21
the applicable senior Federal employee, their spouse, 22
or their dependent child. 23
‘‘(3) F
INES.—A senior Federal employee who 24
holds or conducts a transaction involving a covered 25
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financial instrument in violation of this section may 1
be subject to a civil fine assessed by the supervising 2
ethics office under section 13153. 3
‘‘§ 13153. Certification of compliance 4
‘‘(a) I
NGENERAL.—Not less frequently than annu-5
ally, each senior Federal employee shall submit to the su-6
pervising ethics office a written certification that the em-7
ployee, their spouse, or their dependent child has achieved 8
compliance with the requirements of this title. 9
‘‘(b) P
UBLICATION.—The supervising ethics office 10
shall publish each certification submitted under subsection 11
(a) on a publicly available website. 12
‘‘§ 13154. Authority of supervising ethics office 13
‘‘(a) I
NGENERAL.—The supervising ethics office 14
may implement and enforce the requirements of this sub-15
chapter, including by— 16
‘‘(1) issuing— 17
‘‘(A) for applicable senior Federal employ-18
ees— 19
‘‘(i) rules governing that implementa-20
tion; and 21
‘‘(ii) 1 or more reasonable extensions 22
to achieve compliance with this subchapter, 23
if the supervising ethics office determines 24
that an employee is making a good faith 25
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effort to divest any covered financial in-1
struments; and 2
‘‘(B) guidance relating to covered financial 3
instruments; 4
‘‘(2) publishing on the internet certifications 5
submitted by senior Federal employees under section 6
13153(a); and 7
‘‘(3) assessing civil fines against any senior 8
Federal employee who is in violation of this sub-9
chapter, subject to subsection (b). 10
‘‘(b) R
EQUIREMENTS FOR CIVILFINES.— 11
‘‘(1) A
MOUNT.—A fine imposed under this sec-12
tion against a senior Federal employee shall be equal 13
to the greater of— 14
‘‘(A) $1,000, or 15
‘‘(B) an amount equal to 10 percent of the 16
greatest dollar value of the applicable covered 17
financial instrument during any period that 18
such instrument was held by the applicable sen-19
ior Federal employee or their spouse or depend-20
ent child (as the case may be). 21
‘‘(2) I
N GENERAL.—Before imposing a fine pur-22
suant to this section, the supervising ethics office 23
shall provide to the applicable senior Federal em-24
ployee— 25
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‘‘(A) a written notice describing each cov-1
ered financial instrument transaction for which 2
a fine will be assessed; and 3
‘‘(B) an opportunity, with respect to each 4
such covered financial instrument transaction— 5
‘‘(i) for a hearing; and 6
‘‘(ii) to achieve compliance with the 7
requirements of this subchapter. 8
‘‘(3) P
UBLICATION.—The supervising ethics of-9
fice shall publish on a publicly available website a 10
description of— 11
‘‘(A) each fine assessed pursuant to this 12
section; 13
‘‘(B) the reasons why each such fine was 14
assessed; and 15
‘‘(C) the result of each assessment, includ-16
ing any hearing under paragraph (2)(B)(i) re-17
lating to the assessment. 18
‘‘(4) A
PPEAL.—A senior Federal employee may 19
appeal to the supervising ethics office a fine assessed 20
under this section during the 30-day period begin-21
ning on the date the fine is so assessed. 22
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‘‘§ 13155. Audit by Government Accountability Office 1
‘‘Not later than 2 years after the date of enactment 2
of this subchapter, the Comptroller General of the United 3
States shall— 4
‘‘(1) conduct an audit of the compliance by sen-5
ior Federal employees with the requirements of this 6
subchapter; and 7
‘‘(2) submit to each supervising ethics office a 8
report describing the results of the audit conducted 9
under paragraph (1).’’. 10
(b) A
PPLICATION.—The amendments made by sub-11
section (a) shall apply to individuals described in section 12
13152(a) of title 5, United States Code, (as added by sub-13
section (a)) beginning on the date that is 12 months fol-14
lowing the date of enactment of this Act. 15
(c) A
DDITIONALEMPLOYEES.—Section 13121(c)(1) 16
of title 5, United States Code, is amended by inserting 17
‘‘up to 100’’ after ‘‘appoint’’. 18
(d) F
UNDING.—The Director of the Office of Man-19
agement and Budget may transfer such funds as the Di-20
rector considers appropriate, to be derived from unobli-21
gated amounts available for executive branch programs 22
identified by the Director to be duplicative, to the Office 23
of Government Ethics for the purpose of carrying out this 24
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Act, to remain available until the date that is 5 years fol-1
lowing the date of the enactment of this Act. 2
Æ
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