Bernie Sanders says SVB’s CEO was on regional Fed panel overseeing it, planning bill to ‘end this conflict of interest’
Senator Bernie Sanders said he plans to introduce a measure that would prevent executives of major banks from serving on the boards of regional Federal Reserve banks from overseeing them.
“One of the most absurd aspects of a Silicon Valley bank’s failure is that its CEO is actually the director of the same agency responsible for running it: San Francisco Fed. Twitter Saturday. “I will recommend an invoice to end this conflict of interest by banning major bank CEOs from serving on the Fed’s board.”
Greg Becker, the former president and chief executive officer of Silicon Valley Bank, served as a director on the San Francisco Fed board before the bank went bust last week. Lawmakers are scrutinizing why the San Francisco Fed failed to address problems at the lender before it collapsed.
The Fed did not immediately respond to a request for comment on Saturday.
Unlike the Fed’s board of directors in Washington, which consists of officials nominated by the president and confirmed by the Senate, the Fed’s 12 regional banks are run by chairmen appointed by the private board. select. Those directors include business and community leaders, as well as banking executives.
The Dodd-Frank Act of 2010 changed the law to exclude bank executives who serve on regional Fed boards – known as Class A directors – from participating in the selection of those bank presidents. . The change is intended to prevent banks in the region’s Fed districts from selecting the official responsible for overseeing their day-to-day operations.
