.SenRickScott & SenWarren will introduce legislation to require an independent inspector general for the federalreserve and CFPB. The proposal comes after the collapse of SVB and amid concerns and questions from lawmakers about how it happened.
The proposal comes after the collapse of Silicon Valley Bank and amid a chorus of concerns and questions from lawmakers about how it happened and what can be done to prevent other bank failures. In a letter to Fed Chairman Jerome Powell, Scott blasted the Fed for an “unacceptable lack of accountability.”
While the Fed already has an inspector general, Mark Bialek, Scott and Warren contended that the role isn’t independent enough. Currently, the internal watchdog reports to the Fed board. At other big agencies, the inspector general reports to an independent auditor.“The recent bank collapses and regulatory failures by the Fed have underscored the urgent need for a truly independent Inspector General to hold Fed officials accountable for any lapses or wrongdoing,” Warren said in a statement.
The legislation would create a presidentially appointed and Senate-confirmed inspector general who would oversee the Fed and the CFPB, which was created in the aftermath of the global financial crisis. A spokesperson for the current Fed inspector general told the Washington Examiner that the inspector general already has the same independence and authority as all inspectors general to investigate the Fed board and will continue to"provide robust oversight" over the board and CFPB.
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