This Act may be cited as the Honesty and Trust in Service Act.

(a) Regulations required Not later than 180 days after the date of the enactment of this Act, the Secretary of Defense, in consultation with the Secretaries of the military departments, shall issue regulations prohibiting members of the covered Armed Forces and civilian employees of the Department of Defense from entering into transactions on prediction markets in cases in which the member or employee— (1) at the time of the transaction, possesses material nonpublic information relevant to such transaction; or (2) may reasonably obtain such material nonpublic information in the course of performing official duties, including when such information would not otherwise be available to a member of the public exercising reasonable diligence. (b) Enforcement The regulations under subsection (a) shall specify a range of punishments for the use of prediction markets in violation of the regulations. (c) Definitions In this section: (1) The term covered Armed Forces means the Army, Navy, Air Force, Marine Corps, and Space Force. (2) The term material nonpublic information means information— (A) that a reasonable investor would consider important in making an investment decision; and (B) that is not publicly available.