Reports Donald Trump Jr. is personally profiting from his connection to his father prompted U.S. Senator John Curtis to ask the Senate Judiciary Committee to develop reforms necessary to curb such conduct (here).

GAB has queried readers for ideas to help the Committee, and an alert GABer flagged a provision in legislation the House Financial Services Committee approved in April (here) modernizing the Defense Production Act.

Current law gives presidents wide-ranging powers to provide financial help to companies critical for national defense. The provision in the reform bill curbs those powers. It would bar any company not only in which the president, vice-president, or a senior defense official has “a significant interest” from receiving assistance but also any company in which a family member has “a significant interest” from receiving assistance as well. Not a complete solution but a first, and important, step. A sign at least some in Congress are willing to act

The Defense Production Act reform bill awaits a vote of the full House. Good chance for House members to go on record on what they think about family members trading on their relatives’ name.

Text of the section follows.

SEC. 209. Limitation on eligibility for assistance.

“(a) In general.—Notwithstanding any other provision of this Act or any other Act, a covered entity is not eligible for assistance authorized under this title.

“(b) Definitions.—In this section:

“(1) COVERED ENTITY.—The term ‘covered entity’ means an entity in which a covered individual directly or indirectly holds a significant interest. For the purpose of determining whether an entity is a covered entity, if securities of the entity are owned, controlled, or held by 2 or more individuals who are related as described in paragraph (2), such securities shall be aggregated.

“(2) COVERED INDIVIDUAL.—The term ‘covered individual’ means—

“(A) the President, the Vice President, or a member of the Defense Production Act Committee; and

“(B) the spouse, child, son-in-law, or daughter-in-law of an individual described in subparagraph (A).

“(3) EQUITY INTEREST.—The term ‘equity interest’ means—

“(A) a share in an entity, without regard to whether the share is—

“(i) transferable; or

“(ii) classified as stock or anything similar;

“(B) a capital or profit interest in a limited liability company or partnership; and

“(C) a warrant or right (other than a right to convert) to purchase, sell, or subscribe to a share or interest described in subparagraph (A) or (B), respectively.

“(4) SIGNIFICANT INTEREST.—The term ‘significant interest’ means owning, controlling, or holding not less than 20 percent, by vote or value, of the outstanding amount of any class of equity interest in an entity.”.