A long-standing U.S. congressional critic of the Federal Reserve said on Friday his proposal to audit the U.S. central bank's monetary policy, an initiative strenuously opposed by the Fed, has been defanged in financial reform legislation in the House of Representatives.

"The plan now is to get an audit put into the bill, but it will be a pseudo audit, it won't amount to much," said Representative Ron Paul in an interview on CNBC television.