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Twitter IPO Makes House Ethics Nervous
Posted at 4:43 p.m. on Nov. 5, 2013
As Wall Street prepares for Twitter to make its initial public offering Thursday, the House Ethics Committee would like to take this “opportunity” to remind members they can’t get in on the stock rush before the general public.
In a year in which IPOs have made the record books, the Ethics panel on Tuesday released a memo specifically mentioning Twitter and reminding members that it is now illegal to participate in IPOs in a manner “other than is available to members of the public generally.”
“The Committee recommends that any Member, officer, or employee who has questions about participating in any IPO contact the Committee in advance of your purchase to determine whether or not the purchase would be permissible under the Act,” the memo said. (Emphasis added by the committee).
The act in question is the Stop Trading on Congressional Knowledge Act, more commonly known as the STOCK Act. Under section 12 of the STOCK Act, members of Congress are barred from purchasing an IPO that isn’t available to the general public.
Twitter is expected to set its final price Wednesday, and will begin the IPO Thursday at a price around $25 a share.