Warren Demands Transparency in Warsh’s Fed Asset Divestments
Senator Elizabeth Warren has written to Kevin Warsh seeking details on buyers and transaction terms for his holdings in the Juggernaut Fund, citing ethical concerns over potential conflicts of interest.
US Senator Elizabeth Warren, chair of the Senate Banking Committee, has formally requested a detailed update from incoming Federal Reserve Chair Kevin Warsh regarding the divestment of his financial assets. In a letter sent on Friday morning, Warren demanded specific information on the identity of buyers and the terms under which Warsh sold his holdings, particularly those tied to the Juggernaut Fund and other vehicles managed by the Duquesne Family Office.
Warsh, who was confirmed by the US Senate on Wednesday as the 17th chair of the Federal Reserve, has pledged to divest all financial assets to comply with ethics rules that prohibit Fed officials from holding stock in banks or banking institutions. During his nomination hearing in April, Warsh stated he had worked with the Office of Government Ethics and agreed to sell all financial assets if confirmed. However, significant portions of his portfolio remain undisclosed due to existing confidentiality obligations.
The scrutiny centres on Warsh’s investments in the Juggernaut Fund, managed by the Duquesne Family Office, the personal investment firm of billionaire hedge fund manager Stanley Druckenmiller. Warsh holds two stakes in the fund valued at more than $50 million each. He joined Duquesne as an adviser after leaving the Fed in 2011 and retains interests in several other Duquesne funds.
Warren has expressed concern that the lack of transparency could mask prohibited holdings. She noted that if a buyer, such as Druckenmiller, were to write Warsh a substantial check immediately before he assumes office, it could raise questions about the access the buyer might have to the Fed chief during his term. Warren previously wrote to Druckenmiller on May 5, requesting he release Warsh from confidentiality agreements that currently prevent the disclosure of assets valued at over $100 million.
The senator has set a deadline of May 29 for Warsh to provide the requested information. Warren’s letter emphasised that customary paperwork and divestitures must be completed before the incoming chair takes the oath of office. She warned that without full disclosure, the public would be unable to verify whether Warsh’s funds hold stock in prohibited financial institutions. Yahoo Finance reached out to Warsh for comment but did not receive an immediate response.
