The Federal Reserve has said it’s setting tougher standards for examiners of the biggest U.S. banks, following criticism by lawmakers that the agency has been captured by the Wall Street firms it supervises.
Bloomberg News reports that the planned changes include creating a formal process for examiners to express dissenting views on oversight, such as whether lenders are complying with banking rules and appropriately responding to regulators’ requests.
The overhaul follows a year-long review that found inconsistency across the Fed’s 12 regional banks tied to supervision practices and reports produced by examiners.
Lawmakers questioned the quality of Fed oversight at Senate hearings last year following complaints by former New York Fed bank examiner Carmen Segarra, who said her ex-employer fired her for refusing to change negative findings about Goldman Sachs. The New York Fed oversees several of the largest U.S. banks, including Goldman Sachs, Citigroup, JPMorgan and Morgan Stanley.
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