FINAL RULE--AMENDMENT TO SUPPLEMENTAL STANDARDS OF ETHICAL CONDUCT FOR EMPLOYEES OF THE BOARD.

The Board of Governors, with the concurrence of the Office of Government Ethics (OGE), is amending 12 C.F.R. Part 6801, its Supplemental Standards of Ethical Conduct for Employees of the Board. This amendment would eliminate the general prohibition on ownership of stock in primary dealers for most Board employees and expand the availability of stock ownership waivers by allowing waivers to be granted permitting Board employees to retain bank stock acquired prior to Federal Reserve employment if the stock does not present a conflict of interest with the employees' duties.

Effective December 8, 1999, 12 C.F.R. Part 6801 is amended as follows:

Part 6801--Supplemental Standards of Ethical Conduct for Employees of the Board of Governors of the Federal Reserve System

1. The authority citation for Part 6801 continues to read as follows:

Authority: 5 U.S.C. 7301; 5 U.S.C. App. (Ethics in Government Act of 1978); 12 U.S.C. 244, 248; E.O. 12674, 54 FR 15159, 3 C.F.R., 1989 Comp, p. 215, as modified by E.O. 12731, 55 FR 42547, 3 C.F.R., 1990 Comp, p. 306; 5 C.F.R. 2635.105, 2635.403(a), 2635.502, 2635.803.

2. Section 6801.103 is amended by:

a. Revising paragraph (a)(2);

b. Redesignating paragraphs (c)(1)(i) and (c)(1)(ii) as (c)(1)(ii) and (c)(1)(iii), respectively; and

c. Adding a new paragraph (c)(1)(i). The revision and addition read as follows:

Section 6801.103--Prohibited financial interests.

(a)
  ***
    (2)A primary government securities dealer or any
      of its affiliates, if such employee has regular,
      ongoing access to Class I Federal Open Market
      Committee information.

(c) ***

  (1) ***

    (i) Prior to Federal Reserve employment;