The Federal Open Market Committee (FOMC) has banned members of the U.S. Federal Reserve from partaking in the crypto and stock markets.
In a new press release, the FOMC unanimously adopted a comprehensive set of new rules for the investment activities of Federal Reserve members after recent resignations from key officials due to allegations of insider trading during the coronavirus pandemic.
“Under the new rules, senior Federal Reserve officials are prohibited from purchasing individual stocks or sector funds; holding investments in individual bonds, agency securities, cryptocurrencies, commodities, or foreign currencies; entering into derivatives contracts; and engaging in short sales or purchasing securities on margin.
Additionally, senior Federal Reserve officials will be required to provide 45 days’ non-retractable notice for purchases and sales of securities, obtain prior approval for such transactions, and hold investments for at least one year. Purchases and sales also will be prohibited during periods of heightened financial market stress.”
According to the announcement, the regulations would also apply to Reserve Bank vice presidents, research directors, FOMC staff officers, managers and deputy managers, board division directors who attend Committee meetings regularly, and to any other person designated by the Chair, as well as the spouses and children of these individuals.
The new directives are meant to bolster the public’s confidence that the Federal Reserve and the FOMC are neutral entities, according to the press release.
“The rules, which were first announced in October 2021, aim to support public confidence in the impartiality and integrity of the Committee’s work by guarding against even the appearance of any conflict of interest.”
Those who the rules apply to have one year to liquidate their forbidden assets. The new regulations are set to kick in on May 1st, 2022.Don't Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
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