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How have stock ownership rules and blind trust policies for federal officials changed by 2025 to address conflicts of interest?
Executive summary
By 2025, rules addressing officials’ stock ownership and the use of blind trusts remain a patchwork of statutory limits, agency-specific bans, and long-standing federal regulations: the Ethics in Government Act and OGE regulations govern qualified blind/diversified trusts (5 CFR Part 2634) while agencies such as the Federal Reserve have adopted strict, role‑specific prohibitions on individual stock ownership for senior officials [1] [2]. Proposals and advocacy have pushed for broader bans — e.g., Gillibrand–Hawley legislation that would bar stock trading and ownership by Congress and senior executive officials — but that bill is one legislative effort among many, not a universal change adopted across government [3].
1. A legal backbone: federal ethics law and qualified blind trusts
The Ethics in Government Act and implementing OGE rules still provide the basic framework allowing public officials to place assets into qualified blind trusts or qualified diversified trusts; the e‑CFR language stresses that properly structured trusts are intended to assure “true ‘blindness’” so an official cannot be influenced by trust assets [1]. The rules require consultation with the Office of Government Ethics during setup and impose notification steps for nominees to Senate committees — signaling that blind trusts remain an accepted compliance tool, not an obsolete one [1].
2. Agencies layering stricter, role‑by‑role limits
Separate from OGE rules, individual agencies have tightened investment rules for specific senior roles. The Federal Reserve’s 2022 FOMC action — retained in later descriptions — formally bans many senior Fed officials from purchasing individual stocks or sector funds and blocks a range of other asset classes and transactions for those who regularly attend FOMC meetings, applying to spouses and minor children in many cases [2]. That demonstrates how agencies can—and have—set more restrictive standards than the baseline federal ethics regulations.
3. De minimis exemptions and enduring practical gaps
The statutory and regulatory system still contains exemptions and de minimis thresholds. For example, conflict‑of‑interest exemptions permit participation in matters of general applicability where holdings in affected publicly traded entities fall below set dollar or aggregate caps (5 CFR exemptions described in related guidance) — a mechanism that critics say permits practical conflicts to remain [4]. Campaign Legal Center documents highlight that disclosure and recusal duties coexist with agency rules that sometimes still allow officials to own individual stocks, and they point to enforcement weaknesses [5].
4. Legislative pressure for outright bans — proposals, not universal law
Advocates and some bipartisan lawmakers have proposed sweeping bans. The Gillibrand–Hawley “Ban Stock Trading for Government Officials” bill, for instance, would prohibit stock trading, ownership and even blind trusts for members of Congress, the president, vice president and senior executive branch officials, while increasing penalties and disclosure requirements [3]. That proposal illustrates rising political momentum for tougher rules, but available sources do not indicate that such a universal statutory ban had become law across the federal government by 2025 [3].
5. Blind trusts: mechanics, limits, and misconceptions
Plain‑language sources and legal guides reiterate how blind trusts work: an independent trustee controls assets and the beneficiary is intentionally kept unaware of specific holdings, which helps reduce conflict‑of‑interest risk; trusts can be revocable or irrevocable and that distinction affects control and vulnerability to change [6] [7]. Yet analysts and reporting note an important caveat: assets initially placed into a qualified blind trust are still known to the official and therefore can remain a conflict until sold — a structural limitation often misunderstood by the public [7].
6. Enforcement and transparency remain the flashpoints
Critics keep drawing attention to enforcement gaps. The Campaign Legal Center documents argue that disclosure and recusal rules are unevenly enforced and that officials sometimes trade in stocks tied to their official duties; they call for stronger prohibition or enforcement to restore public trust [5]. Proponents of targeted agency rules counter that role‑based, risk‑targeted prohibitions (like the Fed’s for FOMC participants) effectively neutralize the highest‑risk scenarios [2].
7. Bottom line: more layering, not a single new regime
By 2025 the landscape is characterized by layers: federal ethics statutes and OGE trust rules supply the default path [1]; some agencies impose far stricter, role‑specific bans [2]; advocates and bills push broader prohibitions [3]; and de minimis exemptions plus enforcement shortfalls leave unresolved tensions about whether current arrangements sufficiently prevent conflicts [4] [5]. Available sources do not mention a single, across‑the‑board policy enacted by 2025 that uniformly bans stock ownership and blind trusts for all federal officials.