Fed Adopts Sweeping Trading Curbs After Ethics Scandal
- Powell had announced plans for the new rules in October
- Trading of three top officials came under scrutiny last year
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The Federal Reserve formally adopted tough, sweeping restrictions on officials’ investing and trading, aiming to prevent a repeat of the ethics scandal that engulfed the U.S. central bank last year.
The changes codify new guidelines announced in October to restrict active trading, prohibit the purchase of individual securities and boost disclosure requirements among policy makers and senior staff members. The measures follow revelations of unusual trading activity by three top officials in 2020 -- as the Fed intervened aggressively to shield the economy from Covid-19 -- who subsequently resigned.