DoD conflict of interest rule does not apply to senators

Monday - 12/20/2010, 4:05pm EST

The Senate Armed Services Committee prohibits its entire staff and presidential appointees from owning stocks or bonds in companies that have Defense Department contracts. But senators who sit on the panel are allowed to own stocks and invest in defense companies.

The Washington Post reports there are more than 48,000 such companies.

The rule is designed to prevent high-ranking Pentagon officials from using inside information to make themselves or their families rich.

But the Post points out that members of the committee have access to a lot of the same inside information. As the only legislative body that decides on presidential nominations, committee receives classified briefings about policy, contracts and plans for strategies and weapons systems.

Some supporters of the current system point out that senators can be voted out of office if the public thinks they are making money inappropriately.

The Post reports 19 of the 28 senators on the Senate Armed Services Committee did hold assets in companies that do business with the Pentagon between 2004 and last year. The holdings were worth a total of $3.8 million to $10.2 million.