The Legislative Integrity Act

Recognizing that public service is a stewardship of trust, not a vehicle for private enrichment; Refusing the normalization of structural conflicts of interest where lawmakers profit from the industries they regulate; Hereby establishes the fundamental separation between legislative power and personal market speculation.

Art. 1.

For the purposes of this Act, the following definitions apply:

1. "Covered Person": A Member of the Legislative Assembly, their legal spouse, and any dependent children under the age of 26.

2. "Prohibited Financial Instrument": Any stock, bond, commodity, future, option, or other derivative where the value is primarily derived from the performance of a specific company, industry sector, or sovereign debt.

3. "Qualified Blind Trust": A trust arrangement where the beneficiary has no knowledge of the specific holdings and no legal right to intervene in management.

4. "The Authority": The Independent Ethics Office, composed of 5 members appointed by the Supreme Court (or equivalent judicial body), funded directly from the state budget.

Art. 2.

1. It is strictly prohibited for any Covered Person to purchase, sell, or otherwise trade Prohibited Financial Instruments during the Member's tenure.

2. Exception: The prohibition does not apply to widely held investment funds (such as mutual funds or Exchange Traded Funds) provided that:

a) The fund is broadly diversified across multiple sectors;

b) The Covered Person has no control over the acquisition or sale of specific assets held within the fund.

Art. 3.

1. Within 90 days of the Act's entry into force (or assuming office), Covered Persons must either fully divest from Prohibited Financial Instruments or place such assets into a Qualified Blind Trust.

2. Tax Deferral Mechanism: To facilitate compliance without punitive financial loss, capital gains taxes realized solely from this mandatory divestiture shall be deferred, provided the proceeds are reinvested into government bonds or diversified funds within 60 days.

Art. 4.

1. Surveillance Power: The Authority is legally empowered to access transaction data from all brokerage firms operating within the jurisdiction to verify compliance. Brokerage firms must automatically report any transaction made by a Covered Person to The Authority.

2. Disgorgement and Penalty: Any violation confirmed by The Authority shall result in:

a) Mandatory forfeiture (disgorgement) of any profit gained from the transaction; AND

b) A civil penalty equivalent to three times (300%) the total value of the prohibited transaction.

3. Criminal Liability: If the trading activity involves the use of non-public information obtained through official duties (Insider Trading), the case must be immediately referred to the Prosecutor's Office.

Art. 5.

1. Establishment of Authority: The Supreme Court shall appoint members of The Authority within 3 months of the publication of this Act.

2. Deadlock Provision: If the Supreme Court fails to appoint the members within the deadline, the appointment power devolves to the Civil Rights Ombudsman (or equivalent independent body protector of citizen rights).

3. Entry into Force: This Act enters into force 6 months after publication, to allow sufficient time for the establishment of The Authority.

EXPLANATORY MEMORANDUM (EXPOSÉ)

1. THE PROBLEM

Lawmakers frequently trade stocks based on non-public information or regulate industries in which they hold significant financial stakes. This creates a structural conflict of interest. The current system allows lawmakers to "bet on the game" they are refereeing.

2. THE OBJECTIVE

The goal of this Act is to decouple personal financial interests from legislative duties. By mandating blind trusts and banning individual stock picking, we ensure that representatives focus solely on the welfare of their constituents.

Constitutionality: The inclusion of families is necessary to prevent trading by proxy. The automated reporting mechanism (Art. 4.1) ensures enforcement is proactive, not reactive, while strictly limiting data access only to The Authority for verification purposes.

3. FINANCIAL IMPACT

The cost of establishing The Authority is estimated to be negligible (<0.1% of the legislative budget). This cost is disproportionately small compared to the billions in potential economic distortion and corruption caused by unethical legislative trading.