U.S. senators agree to Fed audit

May 11, 2010 at 4:01 PM   |   Comments

WASHINGTON, May 11 (UPI) -- U.S. senators voted 96-0 Tuesday to have auditors review the role of the Federal Reserve during the financial meltdown of 2008 and 2009.

""The Fed can no longer operate in virtual secrecy," said U.S. Sen. Bernard Sanders, Ind-Vt., who proposed the amendment, which will be attached to the 1,400-page regulatory reform bill.

"Let's be clear," Sanders said. "When trillions of dollars of taxpayer money are being lent out to the largest financial institutions in this country, the American people have a right to know who received that money and what they did with it. We also need to know what possible conflicts of interest exist involving the heads of large financial institutions who sat in the room helping to make those decisions."

Sanders has long proposed audits for the Fed, which has resisted the initiatives on the grounds that the Fed's Open Market Committee requires autonomy to make monetary policy decisions.

The audit senators approved Tuesday is a one-time audit, not an on-going review.

Earlier, senators rejected a tougher audit proposal that more closely matched the version in the House of Representatives bill, which allows for a complete Fed audit but provides for a 180-day delay before details are released concerning monetary policy decisions.

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