Bernie Sanders to ban big-bank CEOs from serving on Fed boards

Bernie Sanders to ban big-bank CEOs from serving on Fed boards

Senator Bernie Sanders said he plans to introduce a measure that would prevent big-bank executives from serving on the boards of the regional Federal Reserve banks that oversee them.

The Vermont senator said on Saturday that one of the most absurd aspects of the Silicon Valley bank failure was that its CEO was a director of the same body in charge of regulating it: the San Francisco Fed. I will be introducing a bill to end this conflict of interest by banning big bank CEOs from serving on Fed boards. Greg Becker, Silicon Valley Bank's former president and chief executive officer, had served as a director on the San Francisco Fed board before the bank failed last week. The San Francisco Fed didn't address problems at the lender before it collapsed, according to lawmakers.

Unlike the Fed board in Washington, which is made of officials nominated by the president and confirmed by the Senate, the Fed s 12 regional banks are run by presidents chosen by private boards of directors. The directors are made of business and community leaders, as well as bank executives.

The 2010 Dodd-Frank Act dissolved the law to exempt bank executives serving on regional Fed boards, known as Class A directors, from being able to participate in the selection of bank presidents. The change was intended to prevent banks in the regional Fed districts from selecting the official responsible for their day-to- day operations.