Former US Fed governor quit after repeated violations of trading rules
NEW YORK: Former Federal Reserve governor Adriana Kugler resigned in August after multiple violations of the central bank’s strict ethics rules, newly released government disclosures showed on Saturday (Nov 15).
Kugler, who joined the Fed in 2023, stepped down after seeking a waiver to address repeated investing violations involving her spouse, including trades in individual stocks and transactions made around Federal Open Market Committee (FOMC) meetings. A Fed official said her request was denied.
Kugler did not attend the July 30–31 FOMC meeting and resigned the following day.
ETHICS BREACHES REFERRED TO INSPECTOR GENERAL
A filing released by the Office of Government Ethics detailed additional trades that broke Fed rules, including prohibited stock purchases and transactions made on or near policy meetings. Her final disclosure was not certified by the Fed’s ethics officer, which is rare.
Kugler told officials that the violations were tied to her spouse and said he did not intend to breach any policies.
The Fed’s Inspector General said it has opened an investigation after receiving the referral, but added it would not comment further until the review is completed.
Kugler’s ethics issues first surfaced in October 2024 when she reported the purchase of Apple and Cava Group stock, which were later sold. She subsequently received additional ethics training.
FED UNDER SCRUTINY
The case is the latest setback for the Fed as it tries to rebuild confidence after earlier scandals involving regional bank chiefs who traded financial markets while shaping monetary policy.
The central bank has tightened rules significantly since 2021, barring officials and their families from buying individual stocks and restricting trading windows.
Kugler’s departure allowed President Donald Trump to appoint Stephen Miran to the seat. Miran has pushed aggressively for deeper rate cuts and is currently on leave from the White House, raising concerns about the Fed’s political independence.
Senator Elizabeth Warren said the episode showed the need for tougher safeguards. She urged Congress to pass new bipartisan legislation “to make the Fed more transparent and accountable”.
