A group of Senate Democrats this week unveiled legislation aimed at preventing presidents and other top federal officials from personally profiting from lawsuits filed against the U.S. government while in office.
The Stop Presidential Embezzlement Act was introduced in the Senate on Tuesday and publicly announced on Feb. 11 by lawmakers, including Sen. Peter Welch, D-Vt.; Sen. Ron Wyden, D-Ore.; Senate Minority Leader Chuck Schumer, D-N.Y.; and Sen. Ben Ray Lujan, D-N.M.
The bill would amend the Internal Revenue Code to impose a 100% tax on any settlement, verdict, judgment or other monetary award that a covered official receives from the federal government as a result of a civil action filed while holding office.
Under the proposal, the tax would effectively strip away any financial benefit, ensuring the official does not net money from the lawsuit.
Legislative text defines "covered persons" as the president, vice president, members of Congress and senior executive branch officials, including Cabinet-level officers and certain relatives.
The legislation was drafted amid attention on a rare lawsuit filed by President Donald Trump against the Internal Revenue Service and the U.S. Treasury Department, seeking roughly $10 billion in damages over the unauthorized disclosure of his tax returns.
The suit, filed in late January in federal court in Florida, alleges reputational harm and financial losses tied to the leak of tax information from Trump's earlier presidency.
Sponsor statements framed the bill as closing a potential loophole that could allow a sitting president or other high-ranking official to leverage their position to extract taxpayer funds.
"While hardworking Americans struggle to make ends meet, the president is trying to line his pockets with taxpayer dollars," said Welch in a press release. "Congress must act to protect taxpayers and uphold trust in democratic institutions."
Opponents of similar measures in past sessions have characterized them as politically targeted or unnecessary, arguing that existing legal and ethical norms constrain such litigation.
Nevertheless, supporters in both chambers have signaled urgency given the unprecedented nature of the current lawsuit and broader concerns about conflicts of interest.
The bill was referred to the Senate Finance Committee for consideration, where its prospects and potential amendments will be debated in the coming weeks.
No committee vote has been scheduled as of this report.
Solange Reyner ✉
Solange Reyner is a writer and editor for Newsmax. She has more than 15 years in the journalism industry reporting and covering news, sports and politics.
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