← Back to Bills
S. 3076Senate117th Congress (2021-2023)In Committee

Ban Conflicted Trading at the Fed Act

Sponsored by Sherrod BrownSen. Sherrod Brown (D-OH)
Introduced October 26, 2021

AI-Generated Summary

Updated February 8, 2026 at 7:35 AM UTC

The Ban Conflicted Trading at the Fed Act would amend the Federal Reserve Act to stop Federal Reserve bank presidents, vice presidents, directors, and Board members from buying, selling, or shorting certain investments that could create conflicts of interest. It applies key provisions of the STOCK Act to these officials and creates new rules for handling their personal holdings. The bill targets senior Fed officials and aims to increase transparency and prevent conflicted trading.

Key Provisions

  • Applies sections of the STOCK Act to Federal Reserve bank presidents, vice presidents, directors, and Board members
  • Defines “covered person” (Fed senior officials) and “covered investment” (securities, commodities, virtual currencies, futures, derivatives, excluding diversified mutual funds and Treasury securities)
  • Prohibits covered persons from purchasing, selling, or creating net short positions in covered investments, except as allowed in the exceptions
  • Allows pre‑office holdings to remain only if placed in a qualified blind trust or divested within six months, with Board approval
  • Requires the Board to issue rules requiring 45‑day advance notice, prior approval for transactions, and a minimum one‑year holding period for investments
  • Sets civil penalties of at least 10% of the investment’s value for knowingly violating the prohibitions

Legislative Activity

Stay on top of the latest movement without scrolling through every action

1 earlier action
SenateIntro Referral Latest Action

Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Banking, Housing, and Urban Affairs Committee

October 26, 2021

View full timeline
SenateIntro Referral

Introduced in Senate

October 26, 2021

SenateIntro Referral

Read twice and referred to the Committee on Banking, Housing, and Urban Affairs.

Banking, Housing, and Urban Affairs Committee

October 26, 2021

Floor Debate

1 member

What members said about S. 3076 on the floor

1 Democrat
Sherrod Brown
Sen. Sherrod BrownD-OH · Nov 16, 2021

Mr. President, I also ask unanimous consent that Senator Ossoff of Georgia be added as a cosponsor of S. 3076, a bill to amend the Federal Reserve Act. Mr. President, not a unanimous consent request,…

Record

Bill Text

Latest available legislative text

Reading Mode
Latest
Raw Text PDF XML
Introduced in SenateIssued October 26, 2021

II

117th CONGRESS

1st Session

S. 3076

IN THE SENATE OF THE UNITED STATES

October 26, 2021

Mr. Brown (for himself, Mrs. Gillibrand, Mr. Merkley, and Mr. Warnock) introduced the following bill; which was read twice and referred to the Committee on Banking, Housing, and Urban Affairs

A BILL

To amend the Federal Reserve Act to prohibit officers of the Federal Reserve from trading certain securities, and for other purposes.

1.

Short title

This Act may be cited as the Ban Conflicted Trading at the Fed Act.

2.

STOCK Act

Section 4 of the Federal Reserve Act (12 U.S.C. 341 et seq.) is amended by adding at the end the following:

Title I of the Ethics in Government Act of 1978 (5 U.S.C. App.), sections 9, 11, 13, and 14 of the STOCK Act (Public Law 112–105), and section 21A(i) of the Securities Exchange Act of 1934 (15 U.S.C. 78u–1(i)) shall apply to Federal Reserve bank presidents, vice presidents, and directors.

.

3.

Ban conflicted trades

The Federal Reserve Act (12 U.S.C. et seq.) is amended by inserting after section 25C (12 U.S.C. 633) the following:

25D.

Ban conflicted trades

(a)

Definitions

In this section—

(1)

the term commodity has the meaning given the term in section 1a of the Commodity Exchange Act (7 U.S.C. 1a);

(2)

the term covered investment—

(A)

means investment in a security, a commodity, virtual currency, or a future, or any comparable financial interest acquired through synthetic means such as the use of a derivative; and

(B)

does not include—

(i)

a diversified mutual fund or investment trust subject to an exemption under section 208(b)(2) of title 18, United States Code, and section 2640.201 of title 5, Code of Federal Regulations; or

(ii)

a United States Treasury bill, note, or bond;

(3)

the term covered person means—

(A)

a member of the Board of Governors of the Federal Reserve System; and

(B)

a president or vice president of a Federal Reserve bank;

(4)

the term future means a financial contract obligating the buyer to purchase an asset or the seller to sell an asset, such as a physical commodity or a financial instrument, at a predetermined future date and price;

(5)

the term security has the meaning given the term in section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78c(a)); and

(6)

the term virtual currency means any cryptocurrency, such as coins or tokens received in connection with initial coin offerings or issued or distributed using distributed ledger or blockchain technology.

(b)

Prohibitions

Except as provided in subsections (c) and (d), no covered person may—

(1)

purchase or sell any covered investment; or

(2)

enter into a transaction that creates a net short position in any security.

(c)

Exceptions

(1)

Investments held before taking office

(A)

In general

A covered person may have control over or knowledge of the management of any covered investment held by the covered person as of the day before the date on which the covered person took office.

(B)

Prohibition on purchasing or selling

A covered person may not buy or sell any investment described in subparagraph (A) except in the case of—

(i)

placing the investment in a qualified blind trust described in subsection (d); or

(ii)

divesting themselves of any investment under paragraph (2).

(2)

Divestiture

A covered person may sell a covered investment during the 6-month period beginning on—

(A)

the date on which the covered person takes office or begins employment, as applicable;

(B)

the date of enactment of this section; or

(C)

the date on which the covered person receives a covered investment through gift or inheritance.

(3)

Approval

Any transaction described in this subsection shall be approved in accordance with the rules issued under subsection (f).

(d)

Trusts

(1)

In general

On a case-by-case basis, the designated agency ethics official of the Board of Governors may authorize a covered person to place their securities holdings in a qualified blind trust approved by the Board under section 102(f) of the Ethics in Government Act of 1978 (5 U.S.C. App.).

(2)

Blind trust

A blind trust permitted under this subsection shall meet the criteria in section 102(f)(4)(B) of the Ethics in Government Act of 1978 (5 U.S.C. App.), unless an alternative arrangement is approved by the Board.

(e)

Administration and enforcement

(1)

Administration

The provisions of this section shall be administered by the Board.

(2)

Enforcement

Whoever knowingly fails to comply with this section shall be subject to a civil penalty of not less than 10 percent of the value of the covered investment that was purchased or sold or the security in which a net short position was created in violation of this section, as applicable.

(f)

Other requirements

Not later than 90 days after the date of enactment of this section, the Board shall issue rules that require covered persons and senior staff to—

(1)

provide 45 days advance notice and prior approval for any investment transactions; and

(2)

hold investments for a minimum of 1 year from the date of the transaction.

.