Bernie Sanders says SVB CEO is on regional Fed board that oversees it, plans bill to ‘end this conflict of interest’

Senator Bernie Sanders says he plans to introduce a measure that would bar top bank executives from serving on the boards of the regional Federal Reserve banks that oversee them.

“One of the most absurd aspects of the failure of the Silicon Valley bank is that its CEO is a director of the same body in charge of regulating it: the San Francisco Fed,” said the Vermont senator. Twitter Saturday. “It’s me introducing a bill to end this conflict of interest by barring big bank CEOs from serving on Fed boards.

Greg Becker, former president and chief executive officer of Silicon Valley Bank, served as a director on the San Francisco Fed board before the bank failed last week. Lawmakers are investigating why the San Francisco Fed failed to address the lender’s problems before it collapsed.

The Fed did not immediately respond to a request for comment on Saturday.

Unlike the Fed board in Washington, which is made up of officials nominated by the president and confirmed by the Senate, the Fed’s 12 regional banks are run by presidents selected by private boards of directors. Those directors are made up of business and community leaders, as well as bank executives.

The 2010 Dodd-Frank Act changed the law to exclude bank executives who serve on regional Fed boards — known as Class A directors — from participating in the selection of bank presidents. The change is intended to prevent banks in the Fed’s regional districts from choosing the official tasked with overseeing their day-to-day operations.

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