The Federal Reserve transferred $10 billion to Chinese banks.
Most Americans have no idea this happened.
And Rand Paul just exposed the Fed's dirty secret that has Washington elites in full panic mode.
Ron Paul's crusade becomes his son's mission
For decades, former Congressman Ron Paul stood alone calling for Congress to audit the Federal Reserve.
The Texas libertarian made "Audit the Fed" a rallying cry during his 2008 and 2012 Presidential campaigns.
Ron Paul first introduced legislation to audit the Fed back in 2009 after the financial crisis exposed how the central bank handed out secret bailouts to Wall Street banks.
His bill passed the House three times with overwhelming bipartisan support – 327 to 98 in 2012 – only to die in the Senate every single time.
The establishment buried Ron Paul's efforts for years because they knew a real audit would expose how the Fed operates as a private bank enriching Wall Street at taxpayers' expense.
Now his son, Senator Rand Paul, picked up where his father left off.
And what Rand Paul discovered should infuriate every American who works for a living.
The $607 billion bank welfare program nobody knew existed
Rand Paul forced the Federal Reserve to hand over 40,000 pages of documents about a little-known program called Interest on Reserve Balances.
What those documents revealed is stunning.
Since 2013, the Fed paid $607 billion to domestic and foreign banks for literally doing nothing with their money.
In 2024 alone, those payments hit $187 billion – equal to more than 10% of the entire federal deficit that year.¹
Here's the kicker: Chinese banks pocketed $10 billion of that total.²
The Fed literally paid Communist China's banks with American taxpayer dollars.
The Fed pays banks interest to keep money parked at the central bank instead of lending it to consumers and small businesses.
JPMorgan Chase raked in $15 billion from this program in 2024 – more than the megabank's entire investment banking division earned.²
Bank of America, Citigroup, Wells Fargo, and U.S. Bank also cashed massive checks from the Fed.
Together, the five largest American banks collected $136 billion in Interest on Reserve Balances payments from 2013 to 2024.²
Those payments accounted for 12% of all their profits during that period.
But Wall Street wasn't the only beneficiary of the Fed's generosity with taxpayer dollars.
Chinese banks got rich off this scam too.
Chinese banks got rich off this scam too
Eleven of the top 20 recipients of Interest on Reserve Balances payments were foreign banks.
Chinese banks alone received about $10 billion in payments.³
Let that sink in for a moment.
The Federal Reserve – supposedly protecting American economic interests – handed $10 billion to banks controlled by the Chinese Communist Party.
Forty percent of all the money the Fed paid out went to foreign financial institutions.⁴
Think about that for a second.
The Federal Reserve – using its power over the American money supply – transferred billions of dollars from working Americans to banks in China and other countries.
Nobody voted for that.
Congress didn't authorize it.
The Fed just did it.
Before 2008, the Federal Reserve didn't pay banks any interest on their reserves.
Congress changed the law after the financial crisis, supposedly to help the Fed control inflation.
From 2008 to 2016, those interest payments averaged $5 billion per year.
But once interest rates shot above 4%, the Fed's welfare program for big banks exploded.
The payments jumped to $60 billion in 2022, then $176 billion in 2023, and hit $187 billion in 2024.⁵
The Fed operates at a loss while enriching Wall Street
Here's the real kicker.
The Federal Reserve has been losing money every single month since September 2022.
Those losses now total more than $200 billion.⁶
Normally, the Fed makes a profit and sends that money back to the Treasury Department.
But the Fed stopped sending profits to taxpayers while continuing to shovel billions to Wall Street.
The Fed pays banks 4% to 5% interest to park money at the central bank.
Meanwhile, those same banks pay customers 0.01% interest on their savings accounts.⁷
JPMorgan Chase, Bank of America, and the other megabanks pocket the difference.
That's a nice racket if you can get it.
Rand Paul calls this exactly what it is – a bailout for big banks disguised as monetary policy.
"The Federal Reserve pays both foreign and domestic banks to simply park their money in Fed accounts," Senator Paul explained. "In other words, to not loan money at all."⁸
Economist Judy Shelton pointed out that if these payments stopped, banks would buy Treasury securities instead, which would bring interest rates on mortgages down and help ordinary Americans.
But the Fed refuses to end this corporate welfare program.
Democrats and establishment Republicans protect the Fed
Rand Paul introduced the "End the Fed's Big Bank Bailout Act" to stop these payments.
He also tried to attach it as an amendment to the National Defense Authorization Act.
The Senate voted it down 82 to 14.⁹
Fourteen Senators – mostly Republicans – voted to stop enriching Wall Street at taxpayers' expense.
Eighty-two Senators voted to keep the gravy train rolling.
That tells you everything you need to know about whose side they're on.
Democrats claim auditing the Fed would "politicize" monetary policy.
That's garbage.
The Fed already got politicized when it started making up money out of thin air to bail out banks during every crisis.
A real audit would simply force the Fed to explain what it's doing with the power Congress gave it.
Rand Paul also reintroduced his father's "Federal Reserve Transparency Act" – the original Audit the Fed bill.
The legislation would require the Government Accountability Office to conduct a thorough audit of the Fed's operations and report back to Congress.
Current law blocks the GAO from reviewing the Fed's monetary policy decisions.
That means the most powerful unelected institution in America operates without meaningful oversight.
The Fed's chairman ranks as the 11th most powerful person in the world – ahead of the prime ministers of France and the United Kingdom.
Yet this unelected bureaucrat answers to nobody.
The American people deserve to know how the Federal Reserve uses its enormous power over their economic lives.
Every American struggling with high prices should be furious that the Fed pays hundreds of billions to banks for doing nothing while inflation destroys their savings.
Ron and Rand Paul have been right about the Fed all along.
The question is whether enough Americans will wake up and demand accountability before the Fed's reckless policies cause another financial crisis.
¹ Rand Paul, "Chairman Rand Paul Releases New Report Revealing Hundreds of Billions in Taxpayer-Funded Payments to Domestic and Foreign Banks Through the Federal Reserve's Interest on Reserve Balances Program," Senate Committee on Homeland Security and Governmental Affairs, December 11, 2025.
² Ibid.
³ Ibid.
⁴ Ibid.
⁵ Rand Paul, "Dr. Rand Paul Introduces 'End the Fed's Big Bank Bailout Act,'" press release, June 26, 2025.
⁶ Pam Martens and Russ Martens, "The Fed Posts Historic Operating Losses As It Pays Out 5.40 Percent Interest to Banks," Wall Street on Parade, June 26, 2024.
⁷ Ibid.
⁸ Rand Paul, "ICYMI: Dr. Rand Paul's End the Fed's Big Bank Bailout Act Considered in the Senate," press release, October 10, 2025.
⁹ Ibid.
