Fed Audit Deal Reached In Senate → Washingtons Blog
Fed Audit Deal Reached In Senate - Washingtons Blog

Thursday, May 6, 2010

Fed Audit Deal Reached In Senate

A deal was struck in the Senate today regarding an audit of the Federal Reserve.

Senator Dodd worked out a compromise with Senator Sanders, and Dodd will now become a co-sponsor of the bill.

The White House has also apparently signed off on the legislation.

The bill would:

Require the non-partisan General Accountability Office to conduct an independent audit of the Board of Governors of the Federal Reserve System that does not interfere with monetary policy, to let the American people know the names of the recipients of over $2,000,000,000,000 in taxpayer assistance from the Federal Reserve System, and for other purposes.
And the bill provides:
Notwithstanding any other provision of law, the Board of Governors shall publish on its website, not later than December 1, 2010, with respect to all loans and other financial assistance it has provided during the period beginning on December 1, 2007 and ending on the date of enactment of this Act under the Asset-Backed Commercial Paper Money Market Mutual Fund Liquidity Facility, the Term Asset-Backed Securities Loan Facility, the Primary Dealer Credit Facility, the Commercial Paper Funding Facility, the Term Securities Lending Facility, the Term Auction Facility, Maiden Lane, Maiden Lane II, Maiden Lane III, the agency Mortgage-Backed Securities program, foreign currency liquidity swap lines, and any other program created as a result of the third undesignated paragraph of section 13 of the Federal Reserve Act.
As the Hill notes:
A Sanders aide said the bill would now include a “one-time” audit of the steps taken since 2007 to provide emergency lending to banks and other institutions. The Fed is required to post on its website by Dec. 1, 2010 the names of institutions that received aid from its emergency programs.

A summary of the amendment said it preserves statutory protections for Fed monetary policy. The Government Accountability Office (GAO) would also be required to audit the Fed’s governance structure.


An aide to Sanders described the changes as “minor” but a senior GOP aide said Sanders had “gutted” his amendment to placate senior Obama administration officials.
Ron Paul - the original sponsor of the efforts to audit the Fed - writes:
Bernie Sanders has sold out and sided with Chris Dodd to gut Audit the Fed in the Senate. His “compromise” is what the Administration and banking interests want: they’ll allow the TARP and TALF to be audited, but no transparency of the FOMC, discount window operations or agreement with foreign central banks. We need to take action and stop this!
Here's the bill.


  1. It is a start, at least.


  2. Good...now they should change this too

    For Bill on Lawmaker Trading, Delay Is Long and Short of It

    A bill that would require speedier disclosure of stock trades by
    lawmakers has languished for years on Capitol Hill, suggesting
    Congress has little appetite for new rules on how its members manage
    their money.

    The legislation, by Democratic Reps. Brian Baird of Washington and
    Louise Slaughter of New York, would prohibit lawmakers from trading in
    financial markets based on nonpublic information they learn on the
    job. It would also require them to make their financial transactions
    public within 90 days of a purchase or sale.

    Currently, those disclosures are filed once a year, and
    insider-trading laws generally do not apply ...


  3. Earlier, there was an Amendment put forth that could break up some of the big banks. Then, there was a deal reached about auditing the FED. Then, an hour and a half before the markets closed, someone with Citigroup connections did an "erroneous" trade that plunged Wall Street. Are we seeing a declaration of economic war?

    Also, did Greece get pushed over the edge by those banking derivatives sold all over the world? Banking was always key. It is historic.

  4. Maybe I missed something reading the amendment. Auditing is a good first step.... but what are the penalties if the audit finds 'wrong doing'? And how is 'wrong doing' even defined in the context of the amendment?

  5. It appears that the Fed crashed the market today to provide just a taste of what they would do if the Paul/Grayson language passes as an amendment to the financial reform bill. Bernanke is a financial terrorist on a global scale and must not be rewarded for this threat. We must be brave and stand up to him, regardless of the near-term consequences. Bernanke must be exposed as the criminal and terrorist that he is, before he completely distroys the country and leaves nothing for our children.


  7. Thanks, GW, for those of us with jobs and kids and can't find informative news elsewhere.

    Not that familiar with the process, but its not like this is the final deal, or anything? Once the exclusions are evident in the Senate bill, if in fact they are, even in conference things can change, as they should?

  8. Mike: Do you have any evidence that the FED was in any way involved in the market slide? Or is that just conjecture on your part?

  9. The reality is very simple: US Congress simply represents the interests of institutions and individuals who financed the campaigns of its members. What you are witnessing is only an elaborated parody.

  10. Yes, call your Congress representatives today and demand that the Federal Reserve be audited today. No more secret shadow government of Trilateral bankers; lets see where all the taxpayer money hidden in the “rolling 700 billion bailout at one time” was spent.
    To hell with Wall Street, being self sufficient and solvent does not mean that you are an isolationist.
    Main Street Capitalism, Competitive Market, and Free Enterprise are America’s tried and true standard. Our economy and government can recover from this treachery if we act now by getting back to our roots of industry, manufacturing and technology instead of being smothered by the Multinational Banking Corporate Empire, by proxy, by our government.
    Treason is the appropriate criminal charge, big money lawyers will be SOL, and Justice will be served. A lesson will be given and the slate will be clean to move into an enlightened 21st. Century of green energy and Humanitarianism.


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