May 11, 2010 / 4:29 PM / 9 years ago

U.S. Senate rejects broader Fed audit amendment

WASHINGTON, May 11 (Reuters) - The U.S. Senate rejected an amendment on Tuesday that would have exposed the Federal Reserve to broader scrutiny by Congress, which critics said would extend to monetary policy decisions.

The amendment from Republican Senator David Vitter was defeated after both Democrats and Republicans warned that it would compromise the independence of the U.S. central bank.

“The Vitter amendment unfortunately has as its basic purpose the disassembling of this independence,” said Republican Senator Judd Gregg in Senate floor debate.

The vote came immediately after approval of a related amendment that would order a congressional investigation of the Fed’s emergency lending during the 2008-2009 financial crisis, and force the Fed to disclose the names of those it assisted.

Both measures were offered as amendments to a major Wall Street reform bill still being considered in the Senate. (Reporting by Kevin Drawbaugh, Editing by Chizu Nomiyama)

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