Federal Reserve Chair nominee Kevin Warsh has vowed to divest from an investment fund focused on Canadian equities if confirmed as head of the U.S. central bank, according to a recently updated financial disclosure filing.
In a document filed on April 17 that amended his initial submission dated April 10, Warsh informed the Fed’s ethics officer he would sell his stake in the iShares S&P/TSX 60 Index (XIU) should he be confirmed to succeed current Federal Reserve Chair Jerome Powell.
The financier and former Fed governor cited guidance from agency ethics officials stating that his duties as central banker could involve matters affecting the financial interests of the underlying fund. The fund, which targets Canadian equities, is among the holdings Warsh has pledged to divest.
Current regulations for the Federal Reserve restrict investments by policymakers and their immediate family members, including limitations on foreign assets. Warsh’s disclosures released last week revealed he holds a substantial portfolio of investments, many of which are not fully disclosed in his filings — assets he claims will need to be liquidated if confirmed.
The Fed nominee, who faces a confirmation hearing before the Senate Banking Committee on Tuesday, has been the subject of ongoing scrutiny due to an active legal investigation into the Federal Reserve and its leadership. Several lawmakers have pledged to delay his confirmation until the matter is resolved, making it highly improbable he would assume the role when Powell’s term ends on May 15.
The Fed’s internal ethics officer stated: “I continue to believe that Mr. Warsh is in compliance with applicable laws and regulations governing conflicts of interest.”
