Kansas City Fed Approves Reserve Trust Master Account After Alleged Intervention

| Importance: 8/10 | Status: confirmed

The Federal Reserve Bank of Kansas City reversed its 2017 denial and approved Reserve Trust Company’s master account application in May 2018, approximately nine months after former Fed Governor Sarah Bloom Raskin allegedly contacted Kansas City Fed President Esther George. The approval raised significant corruption concerns about the revolving door between government regulatory positions and private sector financial firms. Senator Pat Toomey claimed he was ‘stonewalled’ when requesting documents about the decision process, and the incident later contributed to Raskin’s withdrawn nomination as Fed vice chair for supervision in 2022.

Key Actors

Sarah Bloom Raskin Reserve Trust Company Federal Reserve Bank of Kansas City Esther George Pat Toomey Cynthia Lummis

Tags

federal-reserve corruption revolving-door sarah-bloom-raskin kansas-city-fed reserve-trust-company regulatory-capture master-account-approval

Sources (3)

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