President Barack Obama signed legislation Wednesday barring members of Congress, the president and thousands of federal workers from profiting from nonpublic information learned on the job, calling it an embodiment of the fundamental American value of fair play.
Obama said the move to bar insider trading among lawmakers would assure everyone "plays by the same rules."
"It's the notion that the powerful shouldn't get to create one set of rules for themselves and another set of rules for everybody else," Obama said.
The signing ceremony was a rare bipartisan feel-good moment in Washington, with a number of Republican and Democratic members of Congress, including U.S. Rep. Tim Walz, D-Minn., joining the president on stage.
Walz introduced the STOCK Act in the House and was one of its strongest backers in Congress. Even so, Walz said the new law doesn't go far enough to address ethical issues in Congress.
The congressional watchdog group called Citizens for Responsibility and Ethics in Washington, or CREW, agrees with Walz on that point. CREW has brought corruption allegations against several members of Congress.
The head of that group, Melanie Sloan, described her support for the STOCK Act as lukewarm at best.
“It really is an open question as to how much of an impact this bill will have.”Melanie Sloan, CREW
"I think members of Congress are going to go home and pat themselves on the back and say, 'We really did a lot here, we have this tough new ethics law,'" she said. "But it really is an open question as to how much of an impact this bill will have."
Sloan said she's concerned that key provisions of the Senate version of the bill, such as giving prosecutors more power in public corruption cases, and requiring registration for firms that collect information about Congress and sell it to Wall Street, were stripped out by House Republican leaders.
"The bill is weaker for these losses," said Sloan.
The STOCK Act had been floating around Capitol Hill since 2006 without any interest from leaders of either party, until the CBS News program "60 Minutes" aired a story last fall about insider stock trades by some members of Congress.
With opinion polls showing the public is disgusted with Congress, both chambers moved quickly to pass the STOCK Act.
The new law removes any ambiguity that may have existed around what members of Congress are allowed to do, said Richard Painter, a law professor at the University of Minnesota and the chief ethics lawyer in the George W. Bush administration.
But Painter said he's much more concerned about a related issue that the STOCK Act doesn't address at all -- the selective leaking of inside government information to investors and campaign contributors by lawmakers and administration officials.
"The relationship of campaign cash in return for information is just an extension of the broader problem we have of campaign cash in return for other favors," said Painter.
In an interview after the bill signing, Walz agreed with Painter's concerns and called it a "glaring loophole" in the new law.
"If there's corruption, it's with a small 'c', and it seeps in and it just creates this impression that the folks who pay to have these sit-down meetings and briefings are getting more consideration," said Walz.
Walz said when he meets with campaign contributors, he makes it clear that he will only discuss information in the public domain. He added that he plans to work on new legislation to address some of the gaps in the STOCK Act, as well as improving campaign finance transparency.
Since the new law takes effect immediately, the House and Senate ethics committees have already laid out the guidelines for how members of Congress should comply.
But Melanie Sloan of CREW said she doubts many members will actually get in trouble, even if they do make questionable stock trades.
"Congress doesn't really like to take its own medicine, but it likes to tell the public that it is fixing problems," she said.
(The Associated Press contributed to this report)