The Federal Reserve Board of Governors announced on Thursday that it was a “wide set” of new rules banning the investment activities of top executives and senior officials.
As a result of the new rules, top federal executives will be restricted to purchasing diversified investment vehicles such as investment trusts. The rules prohibit authorities from purchasing individual shares, holding investments in individual bonds, and holding investments in agency securities.
There is a one-year holding requirement and authorities usually need to notify 45 days in advance of purchases and sales.
A senior Federal Reserve Board official said there was strong support for the rules. Officials said rules that required authorities to invest in blind trusts were considered but rejected.
The rule covers 12 Fed bank governors and 7 board members.
“These strict new rules focus on the people we serve and all senior officials on the official mission of the Federal Reserve Board,” Jerome Powell, chairman of the Federal Reserve Board of Governors, said in a statement. We are raising the bar to ensure that we continue to meet. “
The Fed has been on the defensive since The Wall Street Journal and Bloomberg. Two Fed officials have revealed thatDallas Fed President Rob Kaplan and Boston Fed President Eric Rosengren were active traders in 2020 as the central bank provided extensive economic support following the coronavirus pandemic. Kaplan resigned Triggered by disclosure Rosengren resigns For health reasons.
Senator Elizabeth Warren, a Democrat in Massachusetts, called on the Securities and Exchange Commission to review trading activities. The Federal Reserve Board receives vast amounts of personal information about the health of the US economy.
Proponents of Federal Reserve reform also point to investment decisions by Federal Reserve Board Vice-Chairman Richard Clarida and Powell as an example of the need for reform.
The Federal Reserve Board has announced stricter rules to limit transactions by senior officials
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