FinTech Reserve Trust Founder Says Fed Nominee Raskin Allegations ‘Completely False’

Federal Reserve, Sarah Bloom Raskin, Reserve Trust

Sarah Bloom Raskin, a Biden nominee for the Fed’s top banking position, has the co-founder of Reserve Trust defending her over charges that she’s had conflicts of interest between government and private jobs in the past, Bloomberg reported Friday (Feb. 11).

Some Senate Republicans have raised issue with Raskin’s work for Reserve Trust, a Colorado FinTech offering payment processing and business-to-business (B2B) services, after her stint in the Fed under the Obama administration.

Reserve Trust had appealed the Kansas City Fed’s denial of its request for a master account.

According to Dennis Gingold, co-founder and former chair of Reserve Trust, Raskin’s conduct had been good and was “appropriate, ethical and correct.” He said she didn’t have a role in the appeal, and the only entities that had been working on that were the lawyers and the State of Colorado.

According to the Kansas City Fed, while Raskin had some communications with the central bank branch, Reserve Trust’s request was granted because the company had “changed its business model.” Colorado regulators had reinterpreted the state law to allow the company to meet the definition of a depository institution.

See also: API Links FinTechs To Fed Payment Rails

This is at odds with information provided by Sen. Pat Toomey (R-Pa.), a top Republican in the Senate, who cited a phone call he’d had with Kansas City Fed President Esther George, saying that Raskin had personally called about the Reserve Trust application after it was denied.

Raskin has already faced opposition from her ideological opponents, including Toomey, over some of her past actions and political writings.

“It’s not surprising that Reserve Trust’s founder thinks there’s nothing unseemly with hiring a former Fed governor to lobby her former colleague on behalf of his company,” said Amanda Thompson, a spokesperson for Toomey.

PYMNTS wrote recently that Raskin said in January she had “no idea” what the controversy was about and that she didn’t remember making a call on Reserve Trust’s behalf.

Raskin, who left Reserve Trust in 2019, said she intended to do whatever she had to to clear things up for the Senate.

Read more: Fed Nominee Raskin Denies Role in FinTech Reserve Trust Fed Master Account