WASHINGTON, D.C. – Today, U.S. Senator Thom Tillis (R-NC) and every Senate Banking Republican sent a letter to President Joe Biden highlighting their continued concerns regarding the nomination process that has unfolded for Ms. Sarah Bloom Raskin, his selection for the vacant Vice-Chair of Supervision position on the Board of Governors (Board) of the Federal Reserve System.

In addition to Senator Tillis, the letter was signed by Ranking Member Pat Toomey (R-PA) and Senators Richard Shelby (R-AL), Mike Crapo (R-ID), Tim Scott (R-SC), Mike Rounds (R-SD), John Kennedy (R-LA), Bill Hagerty (R-TN), Cynthia Lummis (R-WY), Jerry Moran (R-KS), Kevin Cramer (R-ND), and Steve Daines (R-MT). 

“As you are aware, members of the United States Senate Committee on Banking, Housing, and Urban Affairs were compelled to deny a quorum for the markup scheduled for February 15, 2022, due to the simple fact that Ms. Raskin has continually failed to produce forthright answers to questions posed by committee members,” wrote the senators. “To be explicitly clear, our actions were aimed solely at Ms. Raskin, as we offered to advance the nomination process for all other nominees scheduled for the markup.” 

“Likewise, our actions to deny a quorum were not the result of Ms. Raskin’s radical public comments and beliefs about using federal financial supervisory powers to advance climate change policy,” the senators continued. “Rather, it was the continual evasion and lack of candor about her time on the board of Reserve Trust, a fintech trust company, where Ms. Raskin was a director from 2017 to 2019.”

“Through your administration’s ethics pledge, you rightly recognize the need to ensure “revolving door” influence peddlers are not nominated to senior government positions… We share the same goal of honesty and transparency in government, especially among those nominated to the highest positions of your administration. However, without greater insight into Ms. Raskin’s past activities, we cannot, in good faith, support the advancement of her nomination process. We appreciate your attention and response on this matter,” the senators concluded.

Background

• For seven years, Ms. Raskin served in the Obama administration, first as a Fed governor and then as the Deputy Secretary of the Treasury. While there, she signed an Obama administration ethics pledge to prevent “Revolving Door” lobbying. 
• In May 2017, four months after leaving Treasury, Ms. Raskin joined the Board of Directors of the Reserve Trust Company (Reserve Trust), a non-depository startup fintech in Colorado.
• In June 2017, Reserve Trust’s application for a Fed master account was denied by the Kansas City Fed.
• After the company’s application was denied, Ms. Raskin called, in August 2017, Kansas City Fed President Esther George—with whom she had served on the Fed’s Federal Open Market Committee—on behalf of Reserve Trust. 
• In the wake of Ms. Raskin’s lobbying of President George, the Kansas City Fed reversed its denial decision and granted Reserve Trust a Fed master account in 2018.
• As a result, as Reserve Trust’s website boasts, “Reserve Trust became the first state chartered trust company to obtain a Federal Reserve master account, granting direct access to Federal Reserve clearing, payment, and settlement services.”
• In 2020, Ms. Raskin received nearly $1.5 million by selling her shares in Reserve Trust to QED Investors, a firm co-managed by Amias Gerety, who was one of Raskin’s subordinates at Treasury.
• On a call with Banking Committee staff on January 28, 2022, Ms. Raskin said she did not know why Reserve Trust wanted a master account.
• During the same January 28, 2022 call with Banking Committee staff, Ms. Raskin tried to evade answering whether she communicated with the Kansas City Fed or the Fed about Reserve Trust and ultimately said that she did not remember if she had. 
• Ms. Raskin also refused to answer whether she contacted the Fed or Kansas City Fed on behalf of Reserve Trust when asked by Senator Cynthia Lummis (R-Wyo.) three separate times during her nomination hearing before the Senate Banking Committee on February 3, 2022.
• In questions for the record, Ranking Member Toomey asked Ms. Raskin to turn over documents and to answer a series of detailed questions regarding her work for Reserve Trust, including what actions she took to help Reserve Trust obtain a Fed master account and any communications between Ms. Raskin and the Kansas City Fed or the Fed regarding Reserve Trust’s application.
• In Ms. Raskin’s written responses to Ranking Member Toomey’s questions for the record, Ms. Raskin provided a blanket “I do not recall” or “I am not aware” in response to more than 35 questions.

The full text of the letter is available HERE. 

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