London - Ben Bernanke, the former president of America's central bank, is to become a senior adviser to one of the world's largest hedge funds, raising fresh concerns about the “revolving door” between Washington and Wall Street.
The former Federal Reserve president, who left his post in January 2014, is to join Ken Griffin's Citadel Investment, where he will offer analysis on economic and financial issues to the $25bn (£17bn) fund's investment committees as well as meeting the fund's investors.
He is the latest in a long line of financial regulators and public officials to join the world of asset management. Bernanke's predecessor, Alan Greenspan, joined Paulson & Company in 2008 as an advisor, two years after leaving the Federal Reserve. The former US Treasury Secretary Larry Summers worked for DE Shaw as a part-time managing partner in 2006. More recently Jeremy C Stein, a former Fed governor, joined BlueMountain Capital Management as a consultant.
Bernanke told the New York Times that he was sensitive towards public concerns about the interchange between public officials and Wall Street but insisted his new job was not a conflict of interest.
Bernanke did not disclose what he will be paid by Citadel but he said he would be paid an annual fee, would not own a stake in the firm and would receive no bonus.
Bernanke's move also raised eyebrows because Citadel is one of the most leveraged of the world's major hedge funds. Citadel is also involved in high-frequency trading, which has drawn criticism for unfairly disadvantaging ordinary investors.
The Independent