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House Amends Insider-Trading Bill to Ban GSE Bonuses

House lawmakers passed legislation Friday that prohibits insider trading among their members, amending the bill to ban controversial multimillion-dollar bonuses for senior-level executives with ""Fannie Mae"":http://www.fanniemae.com/portal/index.html and ""Freddie Mac"":http://www.freddiemac.com/.

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The lower chamber cleared the Stop Trading on Congressional Knowledge Act (STOCK) by a vote of 417 to two.

An amendment to the legislation bars executives from receiving bonuses while Fannie Mae and Freddie Mac remain in federal conservatorship.

This is the second insider-trading bill from Congress to prohibit

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bonus pay for GSE executives.

Sens. John McCain (R-Arizona) and Jay Rockefeller (D-West Virginia) amended a Senate version of the STOCK Act that likewise banned bonuses for senior-level staff with either Fannie Mae or Freddie Mac.

Last year 10 executives with the GSEs received $13 million in bonuses, stirring lawmakers to action and prompting numerous calls from Congress to prohibit excessive pay.

Fannie Mae CEO Michael Williams and Freddie Mac CEO Charles ""Ed"" Haldeman announced their resignations shortly thereafter, although neither authorities nor the media made any connection to the controversy over bonuses.

The STOCK Act also requires mortgage disclosures from high-ranking government officials and their spouses.

The inclusion is a reference to recent congressional and federal investigations into Countrywide Financial Corp. loans and special privileges for lawmakers.

If reconciled with the Senate version, the STOCK Act will either move to both chambers of Congress for a full vote or enter conference, where representatives and senators from either party will work out the differences.

About Author: Ryan Schuette

Ryan Schuette is a journalist, cartoonist, and social entrepreneur with several years of experience in real-estate news, international reporting, and business management. He currently lives in the Washington, D.C., area, where he freelances for DS News and MReport.
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