Thursday, October 28, 2021

Federal Reserve announces ethics check after regional officials trade

Federal Reserve Chairman Jerome Powell directed central bank officials to investigate reports of stock trades made by leaders at the Fed’s branches in Dallas and Boston last year.

“This review will help identify ways to further tighten those rules and standards. The board will make changes as appropriate, and to the Reserve Bank’s code of conduct,” a Federal Reserve spokesperson said in a statement obtained by The Epoch Times. Any changes will be added.

“The basic rules that guide personal financial practices for Federal Reserve officials are similar to those of other government agencies. We also have a set of supplemental rules that are stricter than the rules that apply to Congress and other agencies that apply to the Federal Reserve. are unique to the work we do in the U.S.,” the statement added.

Powell last week told Federal Reserve employees to take “a new and comprehensive look at ethics rules” regarding holdings and other financial activities by senior officials.

“This review will help identify ways to further tighten those rules and standards,” it added. “The Board will make changes as appropriate, and any changes will be added to the Reserve Bank’s code of conduct.”

A Wall Street Journal report earlier this month found that Dallas President Robert Kaplan traded shares in companies including Apple Inc, Alibaba Group Holding Ltd and Amazon.com Inc last year, reaching the seven-figure range. Went. The newspaper reported that Boston President Eric Rosengren made several real estate investments in 2020.

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Both bank presidents have issued statements that their trading and investments comply with the Fed’s ethics rules and will subsequently divest their assets.

Kaplan said in a statement, “My financial transactions conducted during my years as Dallas Fed Chairman have complied with the Federal Reserve’s ethics rules, even to avoid the presence of a conflict of interest.” I have decided to change my personal investing practices.” According to the WSJ report.

Rosengren issued a similar statement: “It is extremely important to me to avoid the presence of a conflict of interest, and I am confident that these steps will achieve this.”

The announcement of the Federal Reserve investigation comes after Sen. Elizabeth Warren (D-Mass.) sent a letter (PDF) to all 12 regional Fed Bank presidents calling on them to stop trading individual stocks, including Kaplan and Rosengren. has been cited.

“The controversy over asset trading by high-level Fed personnel highlights why it is necessary to ban the ownership and trading of individual shares by senior executives who are supposed to serve the public interest,” she argued.

Jack Phillips

senior reporter

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Jack Phillips is a reporter at The Epoch Times in New York City.

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This News Originally From – The Epoch Times

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