Powell Outlines Fed Ethics Approach

Q: Were you were aware of Kaplan and Rosengren trading and do you think that was appropriate?

- A: No, I was not aware of the specifics of what they were doing. We understand very well that the trust of the American people is essential for us to effectively carry out our mission. And that is why I directed the Fed to begin a comprehensive review around the ethics rules around activity 3 things I would point to in terms of specific restrictions.

• One, ownership of certain assets is not allowed and bank securities and other things.
• Second, there are times where we are not able to trade at all and buy and sell financial assets. That is the period before and after FOMC meetings. Everyone's ownership and activities are disclosed on an annual basis.
• I would have had to go back and read people's financial disclosures to know what their activities have been. This has been our framework for a long time.
• The other thing you would say is it is now clearly seen as not adequate to the task of really sustaining the public's trust in us. We need to make changes and we are going to do that as a consequence of this. This will be a thorough and comprehensive review. We are going to gather all the facts and look at ways to further tighten our rules and standards.