Sanders modifies Fed audit proposal

WASHINGTON, May 7 (UPI) -- Sen. Bernie Sanders, Ind.-Vt., said he has modified a proposal for an audit of the Federal Reserve to help move a financial reform package nearer to passage.

Sanders' new proposed language -- offered as an amendment to the financial reform bill -- would require the Fed to reveal how it lent or committed trillions of dollars during the 2008 financial crisis, The Hill reported Thursday.

The Federal Reserve and the White House both had expressed concern the amendment as originally written would jeopardize the independence of the bank as it sets monetary policy, congressional sources said.

After Saunders announced the language change, the Treasury Department quickly offered its support for the amendment.

"We are confident that the revised amendment proposed by Senator Sanders strikes the appropriate balance," said Neal Wolin, deputy treasury secretary.

An aide to Sanders told The Hill the bill would include a one-time audit of steps taken since 2007 to provide emergency lending to banks and other financial institutions. The Fed faces a Dec. 1 deadline to post, on its Web site, names of institutions that received aid from its emergency programs.

An summary of the amendment says it would preserve statutory protections for Fed monetary policy and require the Government Accountability Office to audit the Fed's governance structure.

Opponents to the change say the alteration guts the intent of the original amendment, which was to provide more transparency in the Fed, the Washington publication said.