Draft legislation, laptop showing prediction market chart, and eyeglasses on a large wooden table.
A new legislative proposal, dubbed the Stop Lawmakers From Predicting Act, seeks to prohibit members of Congress, their spouses, and dependent children from engaging in wagers on prediction markets. The bill, introduced by House Administration Committee Chairman Bryan Steil (R-Wis.), specifically targets bets related to public policy and election outcomes where lawmakers might possess or leverage insider information.
The proposed ban would cover any predictions concerning the occurrence, non-occurrence, or extent of specific government policies, actions, or political outcomes that a lawmaker becomes aware of due to their congressional service. Chairman Steil emphasized the importance of public trust, stating, “The American people deserve to know their Member of Congress is not profiting off insider information. This legislation is critical to restoring the public’s trust in their elected officials. Lawmakers should be writing policy, not wagering on its outcome.”
Violators of this act would face penalties including a fine equivalent to $2,000 or 10% of the transaction’s value, whichever is greater, plus any net gains derived from the prohibited transaction. The bill also stipulates that such fines cannot be paid using Members’ Representational Allowance, Senate personnel and office expense accounts, or political contributions. Furthermore, lawmakers who resign or retire without settling these fines could be referred to the Justice Department for civil enforcement.
This initiative follows recent scrutiny of prediction markets. In March, blockchain analysts identified suspicious betting patterns on markets related to the Iran conflict, suggesting potential insider trading. The Stop Lawmakers From Predicting Act was advanced by the Committee on House Administration shortly after this incident, reflecting a growing concern over ethical conduct and the potential for illicit financial gains through non-public information within government circles.
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