The Stock Market Made Nancy Pelosi Rich. Now, She Wants To Ban Her Colleagues From Trading.

House speaker's fortune has grown $140 million since 2008, thanks in part to her husband's trades

Nancy Pelosi, Paul Pelosi
House Speaker Nancy Pelosi and her husband, Paul. / AP
October 5, 2022

House Speaker Nancy Pelosi (D., Calif.) has seen her net worth increase by $140 million since the 2008 financial crisis thanks in no small part to her husband’s fortuitous trades in companies she has worked to subsidize. Now, she's trying to pull up the ladder behind her: In what may be her final months as a member of Congress, she’s backing a proposal that would prohibit her colleagues from buying or selling individual stocks.

Pelosi scoffed at the idea of banning lawmakers from trading individual stocks as recently as December, saying that she and her colleagues should be able to fully participate in the free market economy. After rejecting similar proposals, Pelosi is throwing her weight behind legislation that would ban stock trading among members of Congress and other senior government officials. House Democratic leaders introduced the Combating Financial Conflicts of Interest in Government Act last Tuesday but failed to bring the measure to a vote before adjourning for the midterm elections.

Pelosi has been dogged by allegations that her husband, Paul Pelosi, trades stocks on inside information gleaned from her position in Congress. In March, Paul Pelosi exercised options to buy up to $5 million worth of Tesla stock as the speaker pushed for electric vehicle subsidies, the Washington Free Beacon reported. And in June, Paul Pelosi exercised call options to buy up to $5 million in the graphics card manufacturer Nvidia just weeks before the House considered a bill to provide more than $50 billion in subsidies to domestic semiconductor manufacturers.

Pelosi said in November 2020 after being nominated for a fourth term as speaker that she would relinquish the gavel at the end of 2022. And while she announced in January that she would run for reelection in 2022, there is rampant speculation that she will depart Congress should Republicans retake the House in the upcoming midterm elections.

Even Pelosi’s late-stage about-face is not enough to pacify her progressive critics. Rep. Abigail Spanberger (D., Va.) says the speaker and Democratic leadership only put the bill forward because they knew it would fail.

The bill "was written to create confusion surrounding reform efforts and complicate a straightforward reform priority," Spanberger said in a statement on Friday, "all while creating the appearance that House Leadership wanted to take action."

Pelosi’s portfolio has performed remarkably well during periods of financial turmoil, her financial disclosures show. Her estimated net worth skyrocketed at the onset of the Great Recession, going from $31.4 million in 2008 to $101.1 million in 2010, a 220 percent increase in a window where the S&P 500 decreased by 13 percent. The speaker also reaped a significant return during the COVID-19 pandemic, seeing her estimated net worth jump from $106 million in 2019 to $171.4 million in 2021, an increase of 60 percent.

Government ethics watchdogs noted glaring loopholes in the Pelosi-backed stock trading bill they say will create new avenues for lawmakers to secretly profit from their positions in Congress.

"To say the bill is weak ... would be an understatement. The bill is dangerous. It would undermine what little ethics we have in our federal government," former director of the Office of Government Ethics Walter Shaub said of the measure.

Shaub noted that the bill would enable lawmakers to enter into "fake blind trusts." Typical blind trusts, in which a lawmaker’s assets are handled by an independent manager, require trustees to divest whatever officials put in the trust. But the Pelosi-backed bill would exempt trustees from the divestiture requirement, Shaub said.

"The problem with this bill is it creates a completely separate process and doesn't have any particular rules or requirements around it," Project on Government Oversight government affairs manager Dylan Hedtler-Gaudette told Insider. "You'd be able to create any kind of a trust you want to, put anything you want into it, and call it a blind trust, even though there wouldn't actually be any way to prove that it is, in fact, a blind trust."

The precise net worth of Pelosi and all other members of Congress, is unknown, as lawmakers report a range of values for all their assets rather than exact dollar amounts. Pelosi’s estimated net worth of $171.4 million in 2021 was calculated by taking into account the ranges of all the individual assets and liabilities reported in her financial disclosure statement.

Pelosi joined Congress in 1987 with a net worth of at least $2.7 million, according to her financial disclosure filed that year and obtained by Politifact. Pelosi’s net worth during her inaugural year in Congress was almost certainly higher than that figure, however, because lawmakers were not required at the time to report an upper range for their assets as they are today.

Pelosi has flatly denied allegations of insider trading. Her office did not return a request for comment.