FAST FIVE: Fed Unveils New Rules Cracking Down On Officials' Trading

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Transactions won't be allowed during periods of “heightened financial market stress,” the Fed said in a statement.

“These tough new rules raise the bar high in order to assure the public we serve that all of our senior officials maintain a single-minded focus on the public mission of the Federal Reserve,” said Federal Reserve Board Chair Jerome H.

*  *  * Full Federal Reserve Statement: Following a comprehensive review, the Federal Reserve Board on Thursday announced a broad set of new rules that will prohibit the purchase of individual securities, restrict active trading, and increase the timeliness of reporting and public disclosure by Federal Reserve policymakers and senior staff.

The new restrictions will apply to both Reserve Bank and Board policymakers and senior staff and prohibit them from purchasing individual stocks, holding investments in individual bonds, holding investments in agency securities (directly or indirectly), or entering into derivatives.

To help guard against even the appearance of any conflict of interest in the timing of investment decisions, policymakers and senior staff generally will be required to provide 45 days' advance notice for purchases and sales of securities, obtain prior approval for purchases and sales of securities, and hold investments for at least one year.

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