(Bloomberg News) A U.S. Senate measure that would place restrictions on people who gather and sell government information to hedge funds may entangle bank research analysts and others on Wall Street, according to lawyers and lobbyists.

The Securities Industry and Financial Markets Association, which represents firms including Goldman Sachs Group Inc. and JPMorgan Chase & Co., held a rare weekend call for members on Feb. 4 to discuss the measure, according to two people with direct knowledge of the call.

The provision, part of a broader bill that passed the Senate last week and is scheduled to face a House vote this week, may require analysts and others to register with Congress and disclose contacts with government officials, according to a legal analysis prepared for the group's members.

"There are going to be a lot of entities and organizations who will not want their people anymore to contact government officials to get information which might be used for a number perfectly appropriate purposes," Robert L. Walker, an attorney for Wiley Rein LLP who is listed as one of the authors of the legal memo, said of the impact of the provision.

The broader bill would ban lawmakers, their staffs, and much of the executive branch from trading stocks, commodities or futures based on confidential information they learn on the job. Senator Charles Grassley, an Iowa Republican, succeeded last week in adding the provision that targets trading in so-called "political intelligence."

Such information may include conversations with lawmakers, congressional staff or other government officials about the future of legislation or regulations that have not been made public. That information has been targeted by lawmakers, who are pushing to identify firms and individuals in the business and force them to disclose their clients.

'Who They Are'

Grassley said the requirement will assure that "when these people come around to get information from you to sell to hedge funds, you'll know who they are."

"You give them information, they've got information that people don't have on Wall Street and they sell it," Grassley said on the Senate floor before the vote on his provision. "You ought to know what you're being used for."

In advance of the Sifma call, participants were provided a four-page memo on the provision prepared for Kenneth Bentsen, the executive vice president of public policy for the group. The memo, which says it was written by Wiley Rein lawyers including Walker, notes that because of the way the provision is drafted, "even the routine activities of research analysts would appear to fall within the covered scope of this definition," according to a copy obtained by Bloomberg News.