Members of Congress certainly like to talk the talk, but when it comes to insider trading there seems to be little interest in walking the walk by cooperating with an investigation into a possible leak of confidential information that allowed for lucrative trading.

For all the talk about making Congress subject to the insider trading laws, the hard question was whether it would cooperate with the Securities and Exchange Commission in an investigation into questionable trading on information emanating from Capitol Hill.

The investigation concerns trading in insurance companies in April after a change in the Medicare reimbursement rates by the Centers for Medicare and Medicaid Services leaked out before its official announcement. Sutter and the committee in May for documents and his testimony about contacts with lobbyists at the law firm Greenberg Traurig. Federal prosecutors in Manhattan also served a grand jury subpoena for Mr.

Sutter to testify, and it is not clear whether he has responded. According to the S. The brokerage firm then issued an alert to clients about the reimbursement policy that resulted in a jump in the share price of insurance companies that would benefit. When the investigation first started, Mr. Sutter told an F. Typically, the next step in an investigation is to subpoena records about any contacts the person might have had with sources of the information and potential tippees, which usually includes having them testify under oath.

Whether the person will actually testify is an open question because a lawyer most likely would advise a client to assert the Fifth Amendment right against self-incrimination to keep from making any further damaging statements. Sutter by asking the Ways and Means Committee to voluntarily turn over records related to his government issued cellphone and records of any contacts he had with Greenberg Traurig lobbyists.

The committee, however, refused to provide the requested information. On May 6, the S. In United States v. The lobbyist contacted him to complain about a client being dropped from a Medicare insurance program, which sounds more political than legislative as a type of constituent service.

The larger question is whether Congress has any interest in allowing an investigation to move forward that involves a member of its staff.

In a letter to the S.

How Congress Quietly Overhauled Its Insider-Trading Law : It's All Politics : NPR

That sounds like the price for getting the documents is dropping any further investigation of Mr. Sutter, thus insulating him from potential liability for insider trading. I doubt the S.

A hearing is scheduled for July 1 on whether to enforce the subpoenas, and the losing side can be expected to appeal the case to the United States Court of Appeals for the Second Circuit, and perhaps even to the Supreme Court.

Regardless of the outcome of the battle over the subpoenas, Congress has shown that the STOCK Act was more about responding to negative publicity than a step toward greater accountability for misuse of confidential information.

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