Campaign Event Contract Integrity Act

This Act may be cited as the “Campaign Event Contract Integrity Act”.

In this Act:

(1) Covered campaign-affiliated individual.— The term covered campaign-affiliated individual means any individual who, directly or indirectly, receives compensation from, acts on behalf of, or provides services to—

(A) a candidate for Federal office;

(B) an authorized committee of a candidate for Federal office;

(C) a political committee;

(D) a political party committee;

(E) a leadership PAC; or

(F) any entity or organization substantially engaged in campaign-related activity, including any employee, consultant, advisor, pollster, data analyst, strategist, media consultant, fundraiser, vendor, contractor, volunteer with access to confidential information, or any immediate family member acting on behalf of such individual.

(2) Covered platform.— The term covered platform means any registered entity, designated contract market, swap execution facility, broker, intermediary, or other platform that facilitates trading in political event contracts.

(3) Material nonpublic campaign information.— The term material nonpublic campaign information means confidential information unavailable to the general public that a reasonable person would consider important in deciding whether to purchase, sell, or trade a political event contract, including—

(A) internal polling;

(B) turnout projections;

(C) voter targeting data;

(D) fundraising information;

(E) campaign advertising strategy;

(F) opposition research;

(G) internal campaign analytics;

(H) unreleased endorsement information;

(I) candidate withdrawal or suspension plans; or

(J) any other confidential campaign information designated by rule of the Commodity Futures Trading Commission.

(4) Political event contract.— The term political event contract means any agreement, transaction, swap, option, contract, derivative, or event contract that allows a person to purchase, sell, trade, or otherwise obtain financial exposure based on the outcome of—

(A) a Federal election;

(B) a primary election;

(C) a caucus;

(D) the nomination of a candidate;

(E) control of Congress;

(F) the approval or rejection of legislation; or

(G) any other political or governmental event designated by the Commodity Futures Trading Commission.

(a) Conduct during campaign affiliation.— No covered campaign-affiliated individual may, directly or indirectly, purchase, sell, trade, or otherwise transact in a political event contract while knowingly in possession of material nonpublic campaign information.

(b) Tipping prohibition.— No covered campaign-affiliated individual may communicate, provide, or disclose material nonpublic campaign information to another person when it is reasonably foreseeable that such information may be used to trade a political event contract.

(c) Evasion prohibition.— No person may knowingly trade political event contracts on behalf of, at the direction of, or for the benefit of a covered campaign-affiliated individual for the purpose of evading this Act.

(a) In general.— Each covered platform shall establish and maintain reasonable policies, procedures, and controls reasonably designed to—

(1) detect and prevent trading prohibited under this Act;

(2) identify suspicious trading activity involving campaign-affiliated individuals;

(3) monitor concentrated or coordinated trading activity connected to campaigns, political committees, or affiliated entities;

(4) maintain records sufficient to assist in the detection and investigation of violations of this Act; and

(5) report suspicious activity to the Commodity Futures Trading Commission, as appropriate.

(b) Campaign affiliation disclosure.— A covered platform shall require any trader engaging in political event contract trading above thresholds established by the Commodity Futures Trading Commission to disclose whether such trader—

(1) is employed by, compensated by, or affiliated with a Federal campaign, political committee, or political party committee; or

(2) possesses access to material nonpublic campaign information.

(c) Rulemaking.— Not later than 180 days after the date of the enactment of this Act, the Commodity Futures Trading Commission shall promulgate rules implementing this section.

(a) Authority.— The Commodity Futures Trading Commission may investigate potential violations of this Act and bring civil enforcement actions in an appropriate United States district court.

(b) Civil penalties.— Any person who violates this Act shall be subject to—

(1) a civil penalty not to exceed the greater of—

(A) $250,000; or

(B) three times the profit gained or loss avoided as a result of the violation;

(2) disgorgement of profits obtained through prohibited trading activity; and

(3) temporary or permanent trading bans relating to political event contracts.

(c) Referral authority.— The Commodity Futures Trading Commission may refer evidence of willful misconduct, fraud, conspiracy, false statements, or other criminal violations to the Attorney General.

Nothing in this Act shall be construed to prohibit—

(1) lawful political analysis based exclusively on publicly available information;

(2) journalism, academic research, or public commentary;

(3) trading activity by persons without access to material nonpublic campaign information; or

(4) the lawful operation of political event contracts otherwise permitted under Federal law.

Nothing in this Act shall be construed to—

(1) alter, limit, expand, or otherwise affect the authority of the Commodity Futures Trading Commission under the Commodity Exchange Act;

(2) modify, supersede, or preempt any existing Federal securities, commodities, campaign finance, fraud, ethics, or anti-corruption laws;

(3) prohibit or authorize the prohibition of political event contracts otherwise permitted under Federal law; or

(4) limit the authority of any Federal agency to investigate, enforce, or prosecute conduct otherwise prohibited under Federal law.