Republican U.S. lawmaker Bryan Steil introduced legislation that would bar members of Congress, their spouses and dependent children from profiting through prediction markets tied to politics, government policy or official actions, raising ethics concerns over lawmakers betting on events they could influence.
The bill, titled the “Stop Lawmakers From Predicting Act,” would amend chapter 131 of title 5 of the U.S. Code to create new restrictions on prediction-market trading by what it calls “covered individuals,” a category that includes members of Congress, their spouses and dependent children.
Under the proposal, covered individuals would be prohibited from entering into, or offering to enter into, contracts or transactions whose payout depends on the occurrence, non-occurrence or scale of an event linked to government policy, a government action, a political outcome or any other event that came to their attention through a member’s congressional service.
A new line between public office and political wagers
The legislation targets a corner of financial and political speculation where prediction markets allow users to buy and sell contracts tied to real-world events, including elections, policy decisions and regulatory outcomes.
While the bill does not name any specific platform, its language is broad enough to cover contracts connected to political results, congressional action, administrative decisions and other government-related developments.
The prohibition would apply regardless of whether the event is directly connected to a lawmaker’s official duties, as long as the information reached the covered individual directly or indirectly because of congressional service.
Fines would target both the trade and the profit
The bill lays out an enforcement structure that would require violators to pay a fee determined by the supervising ethics office. That fee would equal the greater of $2,000 or 10 percent of the value of the violating contract, plus any net gain realized from the transaction.
The bill states that lawmakers would be barred from using taxpayer-funded office accounts, campaign contributions or donations connected to their federal office to pay the penalty. Any collected fees would be deposited into the Treasury’s general fund as miscellaneous receipts.
The proposal also includes a referral mechanism for former members of Congress who resign or retire before paying a required fee. In those cases, the supervising ethics office would be able to refer the matter to the Department of Justice.
The bill gives watchdogs time to shape the rules
The bill would take effect 180 days after enactment, giving ethics offices time to prepare guidance before the restrictions begin.
Its introduction signals that Congress is beginning to treat prediction-market activity as a potential ethics risk, particularly as event-based trading moves deeper into politics and public policy.
The proposal also underscores a broader ethics concern, raising questions over whether elected officials and their families should be allowed to bet on outcomes they may be able to influence through their positions.
