1. Short title
This Act may be cited as the “Integrity for Public Officials Act” or the “IPO Act”.
Integrity for Public Officials Act
A BILL
To prohibit senior Government officials, including Members of Congress, from purchasing or selling certain investments, and for other purposes.
2. Definitions
In this Act—
the term commodity has the meaning given the term in section 1a of the Commodity Exchange Act (7 U.S.C. 1a);
the term covered investment—
means investment in a security, a commodity, or a future, or any comparable economic interest acquired through synthetic means such as the use of a derivative; and
does not include—
a widely held investment fund described in section 102(f)(8) of the Ethics in Government Act of 1978 (5 U.S.C. App.); or
a United States Treasury bill, note, or bond;
the term covered person means—
any individual described in section 101(f) of the Ethics in Government Act of 1978 (5 U.S.C. App.), including—
any individual in a position on any level of the Executive Schedule under subchapter II of chapter 53 of title 5, United States Code;
a political appointee in the Executive Office of President or in the Office of the Vice President; and
an individual employed in a position in the executive branch of the Government of a confidential or policy-determining character under schedule C of subpart C of part 213 of title 5, Code of Federal Regulations;
an individual employed in a position in the Senior Executive Service;
an individual employed in a position at the GS–14 level or higher;
an individual employed in a position not under the General Schedule for which the rate of basic pay is equal to or greater than the minimum rate of basic pay payable for GS–14 of the General Schedule; and
the spouse of any Member of Congress (as that term is defined in section 109(12) of the Ethics in Government Act of 1978 (5 U.S.C. App.));
the term future means a financial contract obligating the buyer to purchase an asset or the seller to sell an asset, such as a physical commodity or a financial instrument, at a predetermined future date and price; and
the term security has the meaning given the term in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)).
3. Prohibitions
Transactions— Except as provided in sections 4 and 5, no covered person may—
purchase or sell any covered investment; or
enter into a transaction that creates a net short position in any security.
Positions— A covered person may not serve as an officer or member of any board of any for-profit association, corporation, or other entity.
4. Exceptions
Investments held before taking office—
In general— A covered person may have control over or knowledge of the management of any covered investment held by the covered person as of the day before the date on which the covered person took office (or in the case of a spouse described in section 2(3)(E), the date the applicable Member of Congress took office).
Prohibition on purchasing or selling— A covered person may not buy or sell any investment described in paragraph (1) except in the case of—
placing the investment in a qualified blind trust described in section 5; or
divesting themselves of any investment under subsection (b).
Divestiture— A covered person may sell a covered investment during the 6-month period beginning on—
the date on which the covered person takes office (or in the case of a spouse described in section 2(3)(E), the date the applicable Member of Congress took office); or
the date of enactment of this Act.
5. Trusts for legislative branch of Government
In general— Consistent with section 7, on a case-by-case basis, the Select Committee on Ethics may authorize a covered person to place their securities holdings in a qualified blind trust approved by the committee under section 102(f) of the Ethics in Government Act of 1978 (5 U.S.C. App.).
Blind trust— Consistent with section 7, a blind trust permitted under this section shall meet the criteria in section 102(f)(4)(B) of the Ethics in Government Act of 1978 (5 U.S.C. App.), unless an alternative arrangement is approved by the Select Committee on Ethics.
6. Administration for legislative branch of Government
In general— Consistent with section 7, the provisions of this Act shall be administered by the Select Committee on Ethics of the Senate and the Committee on Ethics of the House of Representatives.
Guidance— Consistent with section 7, the Select Committee on Ethics of the Senate and the Committee on Ethics of the House of Representatives are authorized to issue guidance on any matter contained in this Act, including—
whether a covered person or spouse of a covered person may hold an employee stock option, or similar instrument, that had not vested before the date on which the covered person was elected; and
the process and timeline for when a covered person or spouse of a covered person shall no longer serve as an officer or member of any board of any for-profit association, corporation, or other entity.
7. Administration for executive and judicial branches of Government
With respect to—
a covered person who is an officer or employee of the executive branch of the Government, the Director of the Office of Government Ethics shall carry out sections 5 and 6; and
a covered person who is an officer or employee of the judicial branch of the Government, the Judicial Conference shall carry out such sections.
8. Enforcement
Whoever knowingly fails to comply with this Act shall be subject to a civil penalty of not less than 10 percent of the value of the covered investment that was purchased or sold or the security in which a net short position was created in violation of this Act, as applicable.