Kevin Warsh, the nominee to become the next chairman of the Federal Reserve, has committed to selling his stake in a foreign investment fund should he be confirmed for the position, according to recently filed financial documents.
In paperwork submitted April 17 that updated his original disclosure from April 10, Warsh informed the Federal Reserve’s ethics official that he would sell his holdings in the iShares S&P/TSX 60 Index (XIU) if approved to replace current Fed Chairman Jerome Powell. The nominee, who previously served as a Fed governor and works in finance, explained his decision by stating that “agency ethics officials have since advised me that the duties of my position will involve particular matters affecting the financial interests of the underlying holding” within the investment fund.
The investment vehicle Warsh plans to sell focuses on Canadian stock holdings. Federal Reserve regulations restrict what investments board members and their families can maintain, including limitations on foreign market exposure along with various other restrictions on investment types and portfolio management.
Financial disclosures made public last week revealed that Warsh, who is scheduled for a Senate Banking Committee confirmation hearing on Tuesday, possesses substantial wealth through diverse investments. Many of these holdings remain partially undisclosed, and he has indicated he would need to sell numerous assets if confirmed for the Fed’s top position.
His path to confirmation faces obstacles due to an ongoing legal inquiry involving the Federal Reserve and its current leadership. Several lawmakers have stated they will not support Warsh’s nomination until this investigation concludes, making it unlikely he could assume the role before Powell’s term expires on May 15.
In the updated filing, the Fed’s internal ethics official stated, “I continue to believe that Mr. Warsh is in compliance with applicable laws and regulations governing conflicts of interest.”
