The US Federal Reserve has approved an amended regulation that bans its senior officials from trading stocks, bonds, and cryptocurrencies. The ban was formally announced on Friday.
Under the regulation, senior Fed officials won’t be able to buy, own, or sell assets, including individual stocks, bonds, agency securities, derivatives, foreign currencies, commodities, sector funds, and cryptocurrencies.
The rules were initially announced in October, but cryptocurrencies were not included at that time. According to the Federal Open Market Committee (FOMC), most of the restrictions will become effective on May 1.
The ban covers FOMC members, regional bank presidents, and a number of other officials, including staff officers, bond desk managers, and Fed employees who attend board meetings. They also extend to employees’ spouses and children. While the regulations will apply only to senior Fed staff, the central bank said it expects them to eventually apply to all employees.
“The Federal Reserve expects that additional staff will become subject to all or parts of these rules after the completion of further review and analysis,” the announcement stated.
The ban follows a controversy last year when reports emerged that several officials traded individual stocks and stock funds just before the Fed adopted measures to keep the economy afloat during the Covid-19 crisis. The regulation therefore “aims to support public confidence in the impartiality and integrity of the [Fed’s] work by guarding against even the appearance of any conflict of interest.”
Under the ban, officials who currently hold market positions will have one year to dispose of them. Furthermore, officials covered by the new rules will have to give 45 days’ notice before making any asset purchases and hold those positions for at least a year.
Separately, Congress has also been preparing a measure that would prohibit its members from owning individual stocks, reports say, but no official regulation has been unveiled yet.
For more stories on economy & finance visit RT’s business section