Senate Approves Fed Audit

In a major victory for
transparency at the Federal Reserve,
the Senate today passed an amendment by
Sen. Bernie Sanders to audit the Fed and make the central bank reveal
which
banks received more than $2 trillion in emergency aid during the
financial
crisis

"The
Fed can no longer operate in virtual secrecy," said Sanders (I-Vt.).

Under
his amendment, the Government Accountability Office would conduct a
top-to-bottom audit of all emergency actions by the Fed since the
start of
the financial crisis in 2007. The non-partisan research arm of
Congress specifically
would be directed to investigate apparent conflicts of interest
involving the
Fed and CEOs of the largest financial institutions in the country.

In
addition to the audit, the Fed for the first time would have to reveal
by
Dec. 1, 2010, the identities of banks and other financial institutions
that
took more than $2 trillion in nearly zero-interest loans.

Fed
Chairman Ben Bernanke repeatedly refused
to tell Sanders and others the names of the banks which took the
loans.

"Let's
be clear," Sanders said. "When trillions of dollars of taxpayer
money are being lent out to the largest financial institutions in this
country, the American people have a right to know who received that
money and
what they did with it. We also need to know what possible conflicts
of
interest exist involving the heads of large financial institutions who
sat in
the room helping to make those decisions."

The
amendment, approved by a vote of 96 to 0, was a combined effort by
conservative and progressive senators and a wide spectrum of grass
roots
organizations.

The
Fed is fighting federal court judgments ordering the central bank to
divulge
the information that was sought in Freedom of Information Act lawsuits
by
Bloomberg News and other news organizations.

The
information that the Fed has withheld is separate from the $700
billion in
Wall Street bailouts approved by Congress under the Troubled Asset
Relief
Program. Recipients of those funds were posted on the Treasury
Department Web
site.