Steil bill bars lawmakers from betting on prediction markets

Republican Rep. Bryan Steil introduced the five-page Stop Lawmakers from Predicting Act on Thursday. The bill would prohibit members of Congress, their spouses and dependents from placing wagers on prediction markets that reference specific government actions, policies or political outcomes.

Under the proposal, violations would carry a fine of about $2,000 or 10% of the transaction value, whichever is greater, plus any net gain realized from the bet.

Steil wrote in a statement that the bill aims to prevent lawmakers from using nonpublic information for personal gain and to restore public trust. “The American people deserve to know their Member of Congress is not profiting off insider information,” he wrote, adding that lawmakers should be writing policy rather than wagering on its outcome.

Prediction markets have grown in recent months, prompting concern from regulators and lawmakers about the risk of insider trading. Those concerns intensified after an anonymous account reportedly won more than $400,000 by betting that Venezuelan President Nicolás Maduro would be removed from power within a month. Prosecutors later arrested Gannon Ken Van Dyke, 38, an active-duty U.S. Army soldier, who is accused of using confidential information to place that wager.

The Senate last month acted to bar its members from trading on prediction markets. The platforms involved have said they are taking steps to curb insider trading.

In the House, Steil’s bill would add to other measures that restrict financial activity by members, including legislation that would bar lawmakers and their families from buying individual publicly traded stocks. Additional bills have been introduced to prohibit members from participating in prediction markets.