Exclusive: Fed bank chiefs, in letter to Sen. Warren, pledge to comply with ethics review

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FILE PHOTO: The Federal Reserve building is set against a blue sky in Washington, US, May 1, 2020. Businesshala / Kevin Lamarck / FILE PHOTO
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(Businesshala) – U.S. Federal Reserve regional bank presidents responded to Democratic Senator Elizabeth Warren’s criticism of its ethics rules with a joint letter welcoming a review of the matter by the Fed’s board of governors and any changes resulting from that process. promised to do .

“Recently, Federal Reserve Chairman Jerome Powell has directed staff on the Board of Governors to conduct a comprehensive review of ethics rules regarding permissible financial holdings and activities by senior Federal Reserve officials,” the presidents said as seen by Businesshala. According to a copy of the letter said. . “We welcome this important review and will implement the resulting changes to each Federal Reserve Bank’s code of conduct.”

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The letter, dated September 20, was written by St. Louis Fed President James Bullard on behalf of all banks and signed by each bank president.

Earlier in September, Warren wrote to banks asking them to tighten their ethical rules, which include restrictions on the ownership and trading of individual shares by senior Fed officials.

This sparked an uproar over the trading activities of Dallas Fed Chairman Robert Kaplan and Boston Fed Chairman Eric Rosengren, who made controversial trades last year as the central bank defended the economy. Both announced last month that they would step down from their positions despite the Fed’s ethics officers having cleared their trades.

Powell has since ordered a comprehensive review of the ethics rules governing financial holdings and transactions at the central bank. He has also asked the Fed’s office of inspector general to look into trades made by some senior officials.

Reporting by Lindsey Dunsmuir, Ann Saffir and Jonelle Marte; Editing by Andrea Ricci

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