US politicians have proven to be some of the best traders on Wall Street, consistently beating the market and raising questions over allegiance, integrity and transparency.

Requirements on Australian politicians are even more relaxed than those in America, and this needs to change to boost public trust and integrity in our democracy.

In Australia, federal ministers are banned from holding shares in companies, but there are no restrictions on investments by ministers’ families, their staff, and MPs outside the ministry – leaving the door wide open to insider trading occurring based on information gained via relationships or work.

Thirty per cent of parliamentarians have declared holdings for themselves or their spouses and children.Credit: Dominic Lorrimer

Politicians, by the very nature of their jobs, are privy to information not known to the market and can influence legislation in a way that can materially affect the price of securities.

Last week a bipartisan group of US senators proposed new legislation that would ban members of Congress and their families from trading shares, with large penalties for violations. Now momentum is growing for a similar, but more extensive ban here in Australia.

“Our proposed Australia ban would apply to all parliamentarians, their partners and dependent children, ministerial staff, and senior officials in all public bodies and boards from owning shares or options in public or private companies, either directly or through their self-managed super funds and trusts,” proposes Sean Johnson, the founder of political transparency website Open Politics.

There are presently 67 MPs (30 per cent of parliament) who have declared holdings for themselves or their spouses and children. Mining, energy, financials and telco shares........

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