© Reuters. FILE PHOTO: The Federal Reserve building is set against a blue sky in Washington, U.S., May 1, 2020. REUTERS/Kevin Lamarque/File Photo
WASHINGTON (Reuters) – The U.S. Federal Reserve on Thursday banned individual stock purchases by top officials at the central bank and unveiled a broad set of other restrictions on their investing activities roughly six weeks after reports of active trading by some senior policymakers triggered an ethics uproar.
The new rules will limit the types of financial securities the Fed’s top officials can own, including an outright ban on purchases of individual stocks or holding individual bonds. It also requires advance notice and approval of any transactions, and stipulates investments be held for at least a year.
“These tough new rules raise the bar high in order to assure the public we serve that all of our senior officials maintain a single-minded focus on the public mission of the Federal Reserve,” Federal Reserve Board Chair Jerome Powell said a statement.
In a press release the Fed said the new rules were meant to “help guard against even the appearance of any conflict of interest in the timing of investment decisions.”
The new rules come after two of the 12 regional Federal Reserve bank presidents resigned after reports of their active trading during 2020, when the Fed launched a massive effort to fight the economic impacts of the COVID-19 pandemic.