Federal Reserve Audit and Accountability Act

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Federal Reserve Audit and 
Accountability Act''.

SEC. 2. APPOINTMENT OF FEDERAL RESERVE BANK PRESIDENTS BY THE PRESIDENT 
              BY AND WITH THE CONSENT OF THE SENATE.

    (a) In General.--Section 4 of the Federal Reserve Act is amended by 
inserting after the 4th undesignated paragraph (12 U.S.C. 341; relating 
to general corporate powers) the following new subsection:
    ``(e) Bank Presidents and 1st Vice Presidents.--
            ``(1) Appointment of president.--The President shall 
        appoint, by and with the consent of the Senate, a president for 
        each Federal reserve bank.
            ``(2) Appointment of 1st vice president.--The president of 
        each Federal reserve bank shall appoint a first vice president 
        for the bank.
            ``(3) Terms.--The president and first vice president shall 
        be appointed for terms of 5 years.
            ``(4) Duty of president.--The president of a Federal 
        reserve bank shall be the chief executive officer of the bank.
            ``(5) Duty of 1st vice president.--In addition to any other 
        duties of the first vice president of a Federal reserve bank, 
        the first vice president shall, in the absence or disability of 
        the president or during a vacancy in the office of president, 
        serve as chief executive officer of the bank.
            ``(6) Vacancy.--Whenever a vacancy shall occur in the 
        office of the president or the first vice president, it shall 
        be filled in the manner provided for the original appointment 
        and the person so appointed shall hold office until the 
        expiration of the term to which such person's predecessor was 
        appointed.''.
    (b) Transition.--
            (1) President.--The first appointment of the president for 
        each Federal reserve bank which is made in accordance with the 
        amendment made by subsection (a) shall take place upon the 
        earlier of--
                    (A) the expiration of the term of the president of 
                the bank who is serving in such office on the date of 
                the enactment of this Act; or
                    (B) the occurrence of the first vacancy in the 
                office of president of the bank after the date of the 
                enactment of this Act.
            (2) 1st vice president.--Notwithstanding any provision of 
        the Federal Reserve Act, the term of the first vice president 
        of any Federal reserve bank who was appointed to such position 
        before the date of the enactment of this Act shall end as of 
        the date on which the president of the bank is first appointed 
in accordance with the amendment made by subsection (a) and a first 
vice president shall be appointed in the manner provided by such 
amendment.
    (c) Technical and Conforming Amendment.--The subdivision designated 
``Fifth.'' of the 4th undesignated paragraph of section 4 of the 
Federal Reserve Act (12 U.S.C. 341) is amended--
            (1) in the 1st sentence, by striking ``a president, vice 
        presidents, and''; and
            (2) by striking the 2d, 3d, and 4th sentences and inserting 
        the following new sentence: ``All executive officers and all 
        employees of the bank shall be directly responsible to the 
        president of the bank.''.

SEC. 3. GAO AUDITS OF FEDERAL RESERVE BOARD AND FEDERAL RESERVE BANKS 
              REQUIRED; ITEMIZED BUDGETS.

    (a) Removal of Limitation on GAO Audits.--Section 714(b) of title 
31, United States Code, is amended by striking the 2d sentence and 
inserting the following new sentence: ``In the case of any audit of the 
Board of Governors of the Federal Reserve System or any Federal reserve 
bank pursuant to the preceding sentence, the audit may not include 
transactions for or with a foreign central bank, government of a 
foreign country, or nonprivate international financing organization or 
any part of any discussion or communication among or between members of 
the Board of Governors of the Federal Reserve System or officers or 
employees of such Board which is related to any such transaction.''.
    (b) GAO Audit of Cash Vaults.--Section 714 of title 31, United 
States Code, is amended by adding at the end the following new 
subsection:
    ``(e) Audit of Federal Reserve System Vault Facilities.--
            ``(1) In general.--The Comptroller General of the United 
        States shall audit the vault facilities of the Board of 
        Governors of the Federal Reserve System and each Federal 
        reserve bank at least once every 3 years to determine if a 
        system of proper internal controls is being maintained with 
        respect to each such facility.
            ``(2) Examination of reports of independent auditors.--The 
        Comptroller General shall regularly examine the reports of 
        independent auditors who examine any vault facility referred to 
        in paragraph (1) to determine if such audits have been properly 
        performed.
            ``(3) Report of significant problems.--The Comptroller 
        General shall report any significant problem discovered with 
        regard to any vault facility referred to in paragraph (1) or 
        any audit described in paragraph (2) to--
                    ``(A) the Board of Governors of the Federal Reserve 
                System;
                    ``(B) the Inspector General of the Federal Reserve 
                System; and
                    ``(C) the chairperson and the ranking minority 
                member of the Committee on Banking and Financial 
                Services of the House of Representatives and the 
                Committee on Banking, Housing, and Urban Affairs of the 
                Senate.''.
    (c) Itemized Budgets.--The Federal Reserve Act (12 U.S.C. 221 et 
seq.) is amended by inserting after section 11A the following new 
section:

``SEC. 11B. ITEMIZED BUDGETS.

    ``(a) In General.--During the first 15 days of each regular session 
of Congress, the estimated receipts and proposed expenditures of the 
Board of Governors of the Federal Reserve System and all Federal 
Reserve Banks for the following fiscal year and the 2 succeeding fiscal 
years shall be transmitted to the Congress.
    ``(b) Form of Budget.--The budget submitted pursuant to subsection 
(a) shall be transmitted in the same form and shall meet the same 
requirements, other than the requirement relating to the budget 
message, as the budget of the United States Government transmitted in 
accordance with section 1105 of title 31, United States Code.''.

SEC. 4. PROMPT PUBLIC DISCLOSURE OF OPEN MARKET COMMITTEE MEETINGS.

    Section 12A of the Federal Reserve Act (12 U.S.C. 263) is amended 
by adding at the end the following new subsection:
    ``(d) Prompt Public Disclosures of Meetings.--
            ``(1) Transcription of each meeting.--Subject to paragraph 
        (3), a written verbatim transcript of the discussion at each 
        meeting of the Federal Open Market Committee shall be 
        maintained by the Board and made available to the public before 
        the end of the 1-year period beginning on the date of the 
        meeting and shall be treated as a Government publication for 
        purposes of making such material available to depository 
        libraries through the facilities of the Superintendent of 
        Documents in accordance with chapter 19 of title 41, United 
        States Code.
            ``(2) Prompt disclosure of policy actions.--An explicit, 
        written description of any determination, decision, directive, 
        or other conclusion made by the Federal Open Market Committee 
        at any meeting of the committee, including any directive or 
        instruction sent to any Federal reserve bank or Federal reserve 
        agent in connection with any open market operation, shall be 
        made available to the public by the end of the 1-hour period 
        beginning at the time the Board or any such bank or agent 
        begins to implement any such determination, decision, 
        directive, conclusion, directive, or instruction.
            ``(3) Limited redaction authority.--
                    ``(A) In general.--No verbatim transcript made 
                available to the public pursuant to paragraph (1) may 
                be redacted in any way other than to redact a specific 
                reference to a foreign central bank.
                    ``(B) Compliance audit.--The Comptroller General of 
                the United States shall periodically audit compliance 
                by the Board with the requirements of subparagraph (A).
            ``(4) Release of prior transcripts.--All transcripts 
        maintained by the Board of any meeting of the Federal Open 
        Market Committee which was held more than 1 year before the 
        date of the enactment of the Federal Reserve Audit and 
        Accountability Act shall be made available to the public in the 
        manner provided under paragraph (1) no later than December 31, 
        1997.
            ``(5) Meeting includes executive session.--For purposes of 
        this subsection, the term `meeting' includes any executive 
        session of the Federal Open Market Committee or any informal 
        meeting, teleconference call, or other occasion at which a 
        quorum of the members of the committee are participating.''.

SEC. 23. PRESIDENTIALLY APPOINTED INSPECTOR GENERAL FOR FEDERAL RESERVE 
              SYSTEM.

    (a) Amendments to the Inspector General Act of 1978.--The Inspector 
General Act of 1978 (5 U.S.C. App.) is amended--
            (1) in section 11--
                    (A) in paragraph (1), by inserting ``the Chairman 
                of the Board of Governors of the Federal Reserve 
                System;'' after ``the Chairperson of the Federal 
                Deposit Insurance Corporation;''; and
                    (B) in paragraph (2), by inserting ``the Board of 
                Governors of the Federal Reserve System,'' after ``the 
                Federal Deposit Insurance Corporation,'';
            (2) by redesignating section 8H as 8I and inserting after 
        section 8G the following new section:

``SEC. 8H. SPECIAL PROVISIONS CONCERNING THE FEDERAL RESERVE BOARD.

    ``(a) Delegation.--The Chairman of the Board of Governors of the 
Federal Reserve System may delegate the authority specified in the 
second sentence of section 3(a) to the Vice Chairman of the Board of 
Governors of the Federal Reserve System, but may not delegate such 
authority to any other officer or employee of the Board or any Federal 
reserve bank.
    ``(b) Personnel.--Notwithstanding paragraphs (7) and (8) of section 
6(a), the Inspector General of the Board of Governors of the Federal 
Reserve System may select, appoint, and employ such officers and 
employees as may be necessary for carrying out the functions, powers, 
and duties of the Office of Inspector General and to obtain the 
temporary or intermittent services of experts or consultants or an 
organization of experts or consultants, subject to the applicable laws 
and regulations that govern such selections, appointments, and 
employment, and the obtaining of such services, with the Federal 
Reserve System.
    ``(c) Clarification of Authority.--The authority of the Inspector 
General of the Board of Governors of the Federal Reserve System extends 
to the conditions, operations, and all facilities of the Federal 
reserve banks.'';
            (3) in section 8I, as so redesignated, by striking ``or 
        8E'' and inserting ``8E, or 8H''; and
            (4) in section 8G(a)(2), by striking ``the Board of 
        Governors of the Federal Reserve System,''.
    (b) Position at Level IV of the Executive Schedule.--Section 5315 
of title 5, United States Code, is amended by inserting after 
``Inspector General, Federal Deposit Insurance Corporation.'' the 
following:
            ``Inspector General, Board of Governors of the Federal 
        Reserve System.''.
    (c) Transition Period.--
            (1) Current service.--Except as otherwise provided by law, 
        the individual serving as the Inspector General of the Board of 
        Governors of the Federal Reserve System before the date of 
        enactment of this Act may continue to serve in such position 
        until the earlier of--
                    (A) the date on which the President appoints a 
                successor under section 3(a) of the Inspector General 
                Act of 1978; or
                    (B) the date which is 6 months after the date of 
                enactment of this Act.
            (2) Definition.--For purposes of paragraph (1), the term 
        ``successor'' may include the individual holding the position 
        of Inspector General of the Board of Governors of the Federal 
        Reserve System on or after the date of enactment of this Act.

Summary: Federal Reserve Audit and Accountability Act - Amends the Federal Reserve Act to declare that the president and first vice-president of each Federal reserve bank shall be appointed by the President, with the consent of the Senate. Amends Federal law to remove specified limitations placed upon General Accounting Office audits of the Federal Reserve Board and Federal reserve banks. Directs the Comptroller General to audit at least triennially the vault facilities of the Board of Governors of the Federal Reserve System . Requires the Board and all Federal reserve banks to transmit their estimated receipts and proposed expenditures to the Congress during the first 15 days of each regular session. Mandates prompt public disclosure of Federal Open Market Committee meetings and actions, including policy actions and prior transcripts. Amends the Inspector General Act of 1978 to establish for the Board an Office of the Inspector General, with the Inspector General appointed by the President, subject to Senate advice and consent. Permits the Chairman of the Board to delegate authority for general supervision of the Inspector General to the Vice Chairman, but to no one else. Declares that the Inspector General's authority extends to the conditions, operations, and all facilities of the Federal reserve banks.