The Federal Reserve Board is warning banks to tread carefully when investing trust assets in mutual funds managed by an affiliate.

In a letter being sent to all Fed-supervised banks and holding companies, the agency also said banks risk being accused of having a conflict of interest if they accept incentive payments for investing trust assets in specific mutual funds.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.