New York Federal Reserve Chairman Stephen Friedman resigned on Thursday in the wake of conflict of interest accusations, defending his purchases of Goldman Sachs Group, Inc shares last year.

Friedman says he remained on the board of directors after Goldman Sachs became a bank holding company after receiving a waiver from the Board of Governors of the Federal Reserve System “to provide continuity during a time of financial instability.”

“Today, although I have been in compliance with the rules, my public service motivated continuation on the Reserve Bank Board is being mischaracterized as improper,” he said in a statement. “The Federal Reserve System has important work to do and does not need this distraction.”

New York Fed executive vice president and general counsel Thomas C. Baxter said the purchases in December of 2008 and January of 2009 “did not violate any Federal Reserve statute, rule or policy.”