This is a policy that needs to be addressed and enforced. I work for an agency that has hired a few seasoned employees who worked for the contractor. Yes, managers to took a Govt Job.
Part of their retirement package was the contractor’s 401K program and stock purchase program. They do not purchase shares after they started with the agency; but we cannot force them to liquidate their retirement they started before beginning with the Agency
Then there is the consideration of whether they are in a position to influence (either positively or negatively) future Govt contracts. I understand and support the idea of Govt agents or politicians benefiting from stock, via insider trading.
But there are exceptions
“there is the consideration of whether they are in a position to influence (either positively or negatively) future Govt contracts.”
It is not even a matter of influencing a contract. Just knowing that a lucrative contract is being awarded to a certain company can be important insider information to someone who is inclined to use it. Unfortunately this type of thing is hard to police however most Federal retirements plans do not allow an employee to request investments in specific stocks. They can do that with their own money however.
IOW corruption is built into the system.