Sponsored by Sen. John W. Kern (D) of

Indiana Indiana ( ) is a U.S. state, state in the Midwestern United States, Midwestern region of the United States. It borders Lake Michigan to the northwest, Michigan to the north and northeast, Ohio to the east, the Ohio River and Kentucky to the s ...

, the Kern Amendment amended the Clayton Anti-Trust Act of 1914 by forbidding a Director, officer, or employee of any

Reserve Bank A central bank, reserve bank, national bank, or monetary authority is an institution that manages the monetary policy of a country or monetary union. In contrast to a commercial bank, a central bank possesses a monopoly on increasing the mone ...

having resources in excess of $5,000,000 acting in any similar capacity in another bank; however, it allowed an officer of a FED member bank, with the consent of the

Federal Reserve Board The Board of Governors of the Federal Reserve System, commonly known as the Federal Reserve Board, is the main governing body of the Federal Reserve System. It is charged with overseeing the Federal Reserve Banks and with helping implement the mo ...

, to hold a similar post in two other banks provided they were not in substantial competition with the member bank. In essence, the amendment lessened the prohibition against interlocking directorates dictated by the Clayton Act originally scheduled to go into effect on Oct. 15th, 1916.

References

1914 in American law Legal history of the United States {{US-law-stub