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Transparency and Power: Financial Disclosures for Congress

Did you know that members of congress and key government figures have to report on their finances on a regular basis to ensure transparency? 

Aspire staff had the opportunity to attend a webinar held by OpenSecrets University called “Members of Congress and their personal finances” that outlined exactly what information may be found.

As a result of Ethics in Government Act of 1978, members of congress and other key positions in government are required to disclose their finances annually. And in 2012, after an insider trading scandal, the STOCK ACT or “Stop Trading on Congressional Knowledge Act of 2012” was passed that required lawmakers to disclose securities transactions after a maximum of 45 days, rather than a year, OpenSecrets explains.

What this means for researchers and other people is that there is a lot of available information about the financial positions of members of congress and other key figures in the government.

There are ten parts of financial disclosures including outside income (including spouses), their assets, gifts, liabilities, agreements like publication deals. Using this data, OpenSecrets calculates net worth for individuals. However, there is a lag time between reporting; right now, 2018 data is the most recent year of reporting for overall finances.

However, OpenSecrets does point out that net worth may be negative if a member of congress has more liabilities than assets, such as new freshman class of congress people who are coming in with student debt.

While the information is by no means perfect or necessarily easily understood (and lacks philanthropic data aside from any honorariums given to nonprofits instead of a speaking fee), it’s still an impressive amount of information. OpenSecrets explains that they take the filings and make them digestible for public consumption. There’s even information to know which company has lobbied specific politicians and whether they made contributions to their campaign.

OpenSecrets also notes that there’s information about members of congress at state level but access and availability differs per state.

Taking “Personal” to a Deeper Level

For OpenSecrets, transparency is absolutely key. During the webinar, they explained that this was how they were able to figure out about Senator Richard Burr’s recent sale of stock during the start of the coronavirus through these required disclosures. The result of that information landed the Senator in hot water for insider trading.

For OpenSecrets, they see this information as not an overview of finances but an indication of whether they are involved with conflicts of interest.

It’s a level of information that I suspect people think Researchers normally have access to: stock portfolio, bank account, trust funds, etc. Obviously, this level of detail is not normally publicly available for the majority of our prospects, just in these extremely limited cases for purposes of government transparency.

For researchers, it’s a useful tool for prospects who may serve in congress or another governmental position whether for purposes of wealth capacity or due diligence.

Personal or Public: Be Responsible!

But I think it’s even more a reminder that publicly available information is a gift and something to be used with care. As anyone who has had the experience of researching across borders, US researchers are lucky to have so much data available at our finger tips whether it is real estate records, securities information for public company directors, and so much more.

But with that availability of information comes great responsibility. Just as politicians and other government officials have a responsibility to their constituents and the American people in general, researchers have an important role of safeguarding information of prospects and other people.

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