White House weeks away from naming anyone to Fed

Three empty Federal Reserve board seats await vetting and Senate confirmation; process could linger into the fall

U.S. Federal Reserve Chair Janet Yellen (C) arrives at the Petruzzelli Theatre during a G7 for Financial ministers in the southern Italian city of Bari

WASHINGTON, D.C. — U.S. President Donald Trump is weeks away
from naming anyone to the board of the Federal Reserve, a White
House official said, meaning it could be the fall before three
currently empty seats are filled.The vacancies on the Fed’s seven member Board of Governors
include the position of vice chair in charge of banking
oversight, a critical role in Trump’s plan to revamp financial
rules.The White House wants to get all nominees vetted by the
Federal Bureau of Investigation and the Office of Government
Ethics before they name them publicly and that process can take
months, according to people familiar with the matter.If the vetting drags on, it runs the risk of delaying those
people from taking their jobs until sometime this fall,
complicating Trump’s plan to reshape regulation of Wall Street.The Fed positions require confirmation by the Senate and
could be delayed further by a five-week congressional recess
from the end of July to the beginning of September.Randal Quarles, a veteran of the George W. Bush
administration, is expected to be Trump’s pick for the Fed’s top
bank regulator, Reuters has previously reported. Trump met him
late last month, according to sources familiar with the matter.Quarles, who worked as a partner at private equity firm the
Carlyle Group, currently runs a private investment firm, the
Cynosure Group, from Salt Lake City, Utah. He also served in the
Treasury Department under Bush and was the U.S. executive
director of the International Monetary Fund.Quarles did not immediately respond to a request for comment
on Thursday. A spokesman for the Federal Reserve declined to
comment.The vice chair for supervision and regulation and another
seat that governs community banking were created as part of the
2010 Dodd-Frank financial reform law but were never filled by
President Barack Obama. Former Fed governor Daniel Tarullo had
stepped in to fill the supervision void before leaving the
central bank in April.The White House would like to name all three regulatory
positions at the Fed at the same time, according to people
familiar with the matter. But Treasury Secretary Steven Mnuchin
dismissed that idea publicly last month, saying, “I don’t think
we’re going to do that.”In addition to the three current vacancies, one of which
must be filled by someone with community banking experience,
Chair Janet Yellen and Stanley Fischer, the vice chairman, could
step down when their terms expire next year.Trump could therefore fill as many as five of the board’s
seven seats within the next year, giving him the opportunity to
nominate a block of people who will have a big say in the
direction of interest rates.