Some countries reacted quite weird to the news that the Fed sends data to the US State Department and the US Treasury on the assets that central banks of other countries hold in the US government bonds. There is nothing unusual in this procedure as it allows to monitor compliance with economic sanctions, to prevent financing of terrorist organizations and money laundering, and to make a complete picture of the "hot spots" of the global market. However, it triggered some disturbance.
Now about 250 central banks and governments keep their assets on the accounts of the Federal Reserve Bank of New York. Those assets amount to about $3.3 trillion, which is almost a half of the world USD reserves. However, only the governments of Russia, China, Iraq and Turkey see it as a problem. Oddly enough, these are the countries whose central banks provide financial information upon the first request of the state bodies. However, when someone else does the same, they start accusing of espionage.
That’s why, the Russian Central Bank began to rapidly withdraw its funds from Federal Reserve Bank of New York. After all, the Fed can not only freeze, but also track every movement of money, including not quite legal or absolutely illegal cash flows. However, later, after thinking this situation through, the Central Bank of Russia returned most of the funds back to the Fed’s accounts, apparently after realizing that money would be safer there anyway.
