The Stop Trading on Congressional Knowledge (STOCK) Act of 2012 (Pub. L. 112–105 (text) (PDF), S. 2038, 126 Stat. 291, enacted April 4, 2012) is an act of Congress designed to combat insider trading. It was signed into law by President Barack Obama on April 4, 2012. The law prohibits the use of non-public information for private profit, including insider trading, by members of Congress and other government employees. It confirms changes to the Commodity Exchange Act, specifies reporting intervals for financial transactions.

Originally written and introduced by Washington congressman Brian Baird, the STOCK Act gained popularity following a 60 Minutes segment on congressional insider trading in 2011, after which Republican senator Scott Brown and Democratic senator Kirsten Gillibrand reintroduced bills to combat the practice. In February 2012, the STOCK Act passed in the Senate by a 96–3 vote; the only no votes were senators Jeff Bingaman, Richard Burr, and Tom Coburn. Later the House of Representatives passed it by a 417–2 vote. The bill was supported heavily by vulnerable incumbents and signed into law by President Obama. According to the current United States Senate Select Committee on Ethics, "A member, officer, or employee of the Senate shall not receive any compensation, nor shall he permit any compensation to accrue to his beneficial interest from any source, the receipt or accrual of which would occur by virtue of influence improperly exerted from his position as a member, officer, or employee."

The law is yet another addition to the series of policy created to mandate and regulate the transactions of securities. The Securities Act of 1933 was the first policy created to protect the sale of primary security transactions by companies. Also known as the "Truth in Securities" law, it paved the way to provide investors with more protection and a fair opportunity for their liquid assets. Congress saw the lack of information provided to investors was a large disadvantage to investors and derailed their interest, causing a lack of liquidity in the market during the recovery. It also laid out examples and identified situations of fraudulent activity that has been previously committed by companies. In addition, it provided guidelines for companies with registered publicly held securities to publicly disclose annual and quarterly reports to properly educate their individual investors.

The Ethics in Government Act of 1978 was established decades later to create a code of ethics as a means for political representatives to abide by. Amongst other regulations placed, this piece of legislature also had large implications on the effects of information asymmetry and was intended to create honest and just security transactions. These acts were necessary to prevent fraudulent activity imposed by large corporations and political representatives to which were very capable of hiding information that would benefit their company or their applicable assets.

The STOCK Act is an original bill to prohibit members of Congress and employees of Congress from using private information derived from their official positions for personal benefit, and for other purposes. With this bill in place, members of Congress are no longer allowed to use information garnered through official business for personal reasons. The Stop Trading on Congressional Knowledge (STOCK) Act prohibits members and employees of Congress from using "any nonpublic information derived from the individual's position ... or gained from performance of the individual's duties, for personal benefit". The bill also applies to all employees in the Executive and Judicial branches of the federal government. The STOCK Act required a one-year study of the growing political intelligence industry and requires every Member of Congress to publicly file and disclose any financial transaction of stocks, bond, commodities futures, and other securities within 45 days on their websites, rather than once a year as was required previously. The Act also requires members of Congress and Executive branch officials to disclose the terms of mortgages on their homes, prohibits them from receiving special access to initial public stock offerings, and denies federal pensions to members of Congress who are convicted of felonies involving public corruption. The bill is divided into nineteen sections. The following summary was written by the Congressional Research Service, a nonpartisan arm of the Library of Congress, which serves Congress.

Requires the congressional ethics committees to issue interpretive guidance of the rules of each chamber, including rules on conflicts of interest and gifts, with respect to the prohibition against the use by members of Congress and congressional employees (including legislative branch officers and employees), as a means for making a private profit, of any nonpublic information derived from their positions as Members or congressional employees, or gained from performance of the individual's official responsibilities.

Declares that such members and employees are not exempt from the insider trading prohibitions arising under the securities laws, including the Securities Exchange Act of 1934 and Rule 10b-5. Amends the Securities Exchange Act of 1934 to declare that such Members and employees owe a duty arising from a relationship of trust and confidence to Congress, the U.S. government, and U.S. citizens with respect to material, nonpublic information derived from their positions as Members or congressional employees or gained from performance of the individual's official responsibilities.

Amends the Commodity Exchange Act to apply to members and congressional employees, or to judicial officers or employees its prohibitions against certain transactions, involving the purchase or sale of any commodity in interstate commerce, or for future delivery, or any swap.