Trading by candidates in contracts on their own elections

(a) In general Subchapter I of chapter 301 of title 52, United States Code, is amended by adding at the end the following: 30147. Trading by candidates in contracts on their own elections (a) Definitions In this section: (1) Candidate The term candidate has the meaning given the term in section 301 of the Federal Election Campaign Act of 1971 (52 U.S.C. 30101). (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) Political event contract The term political event contract means any agreement, transaction, swap, option, contract, derivative, or other event contract that allows a person to purchase, sell, trade, or otherwise obtain direct 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) any other political or governmental event by rule by the Commodity Futures Trading Commission. (4) Covered election contract The term covered election contract means, with respect to a candidate, a political event contract the payout or resolution of which depends on— (A) the outcome of an election, primary election, caucus, convention, or nomination contest in which the candidate is seeking nomination for election, or election, to Federal office; (B) whether the candidate is, becomes, or remains a candidate in such a contest; or (C) the vote share, margin, or placement of the candidate in such a contest. (5) Covered person The term covered person means, with respect to a candidate, the candidate, a spouse or dependent child of the candidate, or an authorized committee of the candidate as defined in 52 U.S.C. § 30101(6). (b) Offense Whoever, being a covered person purchases, sells, acquires, disposes of, or holds any interest, directly or indirectly, in a covered election contract with respect to the candidate shall be civilly fined under 52 U.S.C. § 30109 $10,000 per violation; or an amount equal to 3 times the net financial gain attributable to the violation, whichever is greater. (c) Indirect interests For purposes of subsection (b), a person acts indirectly if the person— (1) causes, directs, requests, or induces another person to acquire, hold, or dispose of the interest; (2) holds a beneficial interest in the interest, however titled; or (3) provides funds used by another person to acquire the interest, with knowledge of the intended use. (e) Divestment It shall not be a violation of subsection (b) for a person to hold an interest in a contract that becomes a covered election contract with respect to that person, or to dispose of such an interest, during the minimum period required by covered platforms to divest such contract, beginning on the date on which the person becomes a candidate. (f) Protection for covered platforms (1) No liability under this section No penalty under this section shall apply to a covered platform, or to any officer, director, employee, or agent of a covered platform acting within the scope of that person’s duties. (2) Good faith compliance actions A covered platform, and any officer, director, employee, or agent thereof, shall not be liable to any person under any Federal or State law, or under any contract, for any action taken in good faith to prevent or remedy a violation of subsection (b), including restricting, suspending, or closing an account, or cancelling, voiding, or unwinding a position or transaction. (3) Good faith reporting A covered platform, and any officer, director, employee, or agent thereof, shall not be liable to any person under any Federal or State law for reporting in good faith a suspected violation of this section to the Commodity Futures Trading Commission, the Attorney General, or the Federal Election Commission, and shall not be required to notify any person that such a report has been made..