January 1, Fed Official Quits Amid Stock Trade Scandal

Wyatt’s Take

• Federal Reserve board member quits during ethics probe.
• Family traded banned stocks during blackout periods.
• Disclosures reveal conflicts and tightened Fed rules.

Adriana Kugler left her Federal Reserve board seat in August as a federal ethics investigation looked into stock trades by her family. Records show her husband bought and sold stocks like Apple and Cava, sometimes during periods when such trades are banned before policy meetings.

Kugler stated in filings that she did not know about her spouse’s trades and claimed there was no intent to break the rules.

The Fed strictly limits top officials and their families from trading individual stocks, crypto, and other sensitive assets, especially near important meetings. The disclosures highlight why Kugler’s resignation was so sudden last summer. Though she said she wanted to return to teaching, reports show the decision came amid increased internal scrutiny and pressure from the White House to cut rates.

“As noted in the Board of Governors of the Federal Reserve System’s (Board’s) comment included on Dr. Kugler’s 278 filing, earlier this year we received a referral from the Board’s Ethics Section regarding certain matters related to this filing,” an Office of Inspector General spokesperson said. “We have opened an investigation and, consistent with our practice, we are unable to comment further until our investigation is closed.”

The news comes after several Fed officials quit in recent years for similar issues, prompting stricter trading limits. Recent filings show Kugler’s husband repeatedly bought and sold stocks rapidly, including a major investment in Apple and a timely purchase and sale of Cava just before a board meeting in March.

Kugler did not comment further as the investigation continues.

Stay tuned for more updates on how government ethics affect your pocketbook.

Wyatt Matters

Trust in our institutions starts with leaders who play by the same rules as the rest of us. Folks in Middle America know that those in high places shouldn’t get special treatment or secret deals while the working class follows the law.

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