By Yasin Ebrahim
Investing.com – The Federal Reserve announced new rules Thursday that will seek to ban senior Fed policymakers from investing in stocks.
The new rules, which will be incorporated over the coming months, aim to curb the investment activity undertaken by senior Fed officials including a ban on stock and bond buying. It also requires officials to provide advance notice of 45 days before purchasing or selling any securities and requires that 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,” Fed Chair Jerome Powell said in a statement.
The central bank’s move to quell investment activity by its senior members comes after controversy over reports that multiple Fed officials had been buying and selling stocks just as the central bank rolled out its market-friendly policy to cushion the economic blow from the pandemic.
The ethics uproar that followed the reports of trading activity by senior officials led to regional presidents Robert Kaplan of Dallas and Eric Rosengren of Boston both resigning earlier this year.