Rep. Ruben Gallego (D-AZ), who is in the midst of a competitive U.S. Senate race against Republican election denier Kari Lake, appears to have violated federal financial disclosure law by reporting two transactions nearly two and five years late.
Gallego on Tuesday disclosed an August 2019 purchase of non-publicly traded stock in investment advisory, Aspiration Fund Adviser LLC, valued between $15,001 and $50,000.
Gallego also purchased corporate securities in pronunciation guide services company NameCoach Inc. in June 2022. This investment is also valued between $15,001 and $50,000.
Members of Congress are required to publicly report most purchases, sales and exchanges of stocks, bonds, commodity futures, securities and cryptocurrencies within 45 days of a transaction, as required by the 2012 law known as the Stop Trading on Congressional Knowledge (STOCK) Act.
"Rep. Gallego believes elected officials should be transparent and accountable to the people they represent, which is why he has co-sponsored legislation to clean up Washington and implement stricter disclosure requirements," said a spokesperson for Gallego, who declined to be named. "These investments were disclosed in previous filings and the recently filed report corrects inadvertent errors."
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A Raw Story review of congressional financial records shows that the NameCoach transaction was disclosed on Gallego's 2022 annual report and on an amended version of the report filed Tuesday. The Aspiration Fund Adviser purchase was not disclosed on Gallego's 2019 annual report until Tuesday. The asset and investment agreement appeared on a 2021 annual report, but the report did not specifically note the Aug. 27, 2019 transaction.
Still, for such transactions, members of Congress also need to file a "periodic transaction report" — the formal name of a congressional financial disclosure for assets the STOCK Act mandates must be reported within 45 days of a transaction. Gallego did not appear to file any periodic transaction reports for either purchase.
Gallego co-sponsored the Ban Conflicted Trading Act and TRUST in Congress Act — both related to banning congressional stock trading. He also co-sponsored an anti-corruption reform bill, the For The People Act.
Gallego was first elected to Congress is 2014 and is now running for the U.S. Senate seat that will be vacated in January by Sen. Kyrsten Sinema (I-AZ).
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His opponent, Lake, gained notoriety for her false claims of election fraud in the 2020 and 2022 elections. Lake lost her bid for Arizona governor to Democrat Katie Hobbs by less than one percentage point.
At present, Gallego is just shy of a 6 percent polling lead over Lake, according to The Hill.
Lake’s campaign did not immediately respond to Raw Story’s request for comment.
Another violator
Another member of Congress, Rep. Tom Kean, Jr. (R-NJ), appeared to be more than nine months late disclosing the September 2023 sale of an asset in New Jersey bank, Regal Bancorp, valued between $1,001 and $15,000, according to a new congressional financial filing.
A note on Kean Jr.’s Aug. 13 report said, “Former publicly traded company; filer took no action to initiate this trade; result of a corporate action."
Dan Scharfenberger, Kean Jr.'s chief of staff, emphasized to Raw Story that the line item is a "corporate transaction, not a stock transaction."
"The asset itself was disposed of through a corporate merger that Congressman Kean did not have any input or decision-making control over. As the compliance team has been preparing the congressman's annual personal financial disclosure report, they felt it would be best to over-report and file paperwork with the Ethics Committee on this matter," Scharfenberger said. "Congressman Kean continues to go above and beyond every legal standard to ensure full transparency."
The Senate and House Ethics committees have historically advised members of Congress to disclose investment transactions as the result of corporate decisions such as mergers and acquisitions, but there's often confusion on the exact requirements.
Kean Jr. previously violated the STOCK Act when he was as much as four months late disclosing six personal stock transactions, valued up to $90,000 total.
At the time, Kean Jr. told Raw Story via a September 2023 statement: “Upon taking office, I hired professionals to make certain that any and all transactions that I have control or interest in are reported accurately and quickly. However, this week, the attorney charged with overseeing my personal transaction reporting for the House shared with me that transactions from a family trust account, which I have no control over, were shared with him in an untimely fashion despite regular check-ins and confirmation of accurate reporting.”
Kean Jr. previously blasted STOCK Act violations from his 2022 opponent, Rep. Tom Malinowski, who he beat for his seat representing New Jersey’s 7th congressional district.
Malinowski, a Democrat, failed to properly disclose between $671,000 and $2.76 million in trades in 2020, with more than two dozen stock transactions taking place during the first several weeks of the COVID-19 pandemic. One stock sale in March 2020 involved shares of a medical-diagnostic company that made COVID-19 tests, Business Insider reported.
Kean Jr. supports a ban on members of Congress trading individual stocks, Scharfenberger said.
"He is leading by example as elected officials should always follow this model of transparency," Scharfenberger said. "Congressman Kean is also eager to move all of his stock and fund assets into a Qualified Blind Trust, and is working to diligently do so in consultation with the House Ethics Committee."Kean Jr. is running against Democrat Sue Altman this November.
Epidemic of violations
Four other members of Congress appeared to violate the STOCK Act in the past week, Raw Story reported.
Sens. John Fetterman (D-PA) and Bill Hagerty (R-TN), along with Reps. Stephanie Bice (R-OK) and Sean Casten (D-IL), all filed late disclosures.
Gallego joins Kean, Fetterman, Bice, Hagerty and Casten on a list of more than 50 members of the 118th Congress who Raw Story found to have violated the STOCK Act, mostly with late financial disclosures.
Other lawmakers have reported stock trades that potentially conflict with their official responsibilities, such as lawmakers who trade defense contractor stock while sitting on a congressional committee with defense oversight responsibilities.
Numerous bills have been introduced in recent years to effectively ban stock trading for members of Congress or increase the penalties for violations.
None have yet gotten a floor vote, and during the past three years, former House Speaker Nancy Pelosi has been one of the biggest obstacles to previous stock ban bills advancing.
The latest progress toward a congressional stock trading ban came last month when the Ending Trading and Holdings in Congressional Stocks (ETHICS) Act advanced out of a Senate Committee on Homeland Security and Governmental Affairs markup with an eight to four vote, with Republican senators divided on how to proceed.
The ETHICS Act proposes an immediate ban on members of Congress buying stocks and would prohibit them from selling stocks 90 days after enactment. Members’ spouses and dependent children would be prohibited from trading stocks starting in March 2027, which is when the president and vice president would also be required to divest from covered investments such as securities, commodities, futures, options and trusts.
