Former Federal Reserve Governor Adriana Kugler, who resigned suddenly in August, allegedly violated Fed ethics rules and was the subject of an internal investigation when she resigned, according to documents released Saturday.
In recent weeks at the Fed, Kugler has tried to address the problem with her financial holdings, but Chairman Jerome Powell rejected her request for a necessary waiver ahead of the central bank’s July 29-30 policy meeting, Bloomberg reported, citing Fed officials.
On Saturday, the Office of Government Ethics released Kugler’s latest financial disclosures, which revealed previously undisclosed trades in several individual stocks dating back to 2024. Some of those trades took place during the Fed’s shutdown period, which violated the agency’s ethics rules, the report said.
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Fed ethics officials reported the problem to the agency’s inspector general earlier this year, according to the form. They also chose not to verify the information Kugler submitted about a month after his resignation. An IG spokesman said on Saturday that the investigation was ongoing.
Kugler’s resignation gave Trump an earlier chance to fill a seat on the Fed’s board during his aggressive campaign and urged policymakers to cut interest rates sharply. The position was eventually filled by Trump adviser Stephen Miran, who took unpaid leave from his role as chairman of the White House Council of Economic Advisers and has often advocated rapid rate cuts.
Kugler was appointed to the Fed in September 2023 by former US President Joe Biden.
On August 1, the former Fed governor announced her resignation, effective August 8, about six months before the end of her term. She did not give a reason and missed the July Fed meeting. The Fed explained her absence as a “personal matter.”
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Before the meeting, Kugler requested permission to conduct transactions related to what a Fed official described as illegal financial holdings. It is still unclear which businesses were involved in the request.
Allegations against Kugler
Kugler reportedly asked for an exception to the rules that required top Fed officials to get permission before certain financial transactions and halt trading during blackout periods that coincide with policy talks.
Notably, this is not the first time Kugler has been accused of violating the Fed’s ethics rules. Last year, she admitted in a disclosure that she violated the trading ban when her husband made several stock transactions.
Kugler said her husband bought the stock without her knowledge. The shares were subsequently sold and Kugler was deemed to be in compliance with applicable laws and regulations, according to the disclosures.
The latest documents revealed previously undisclosed trading activities in individual stocks through 2024, transactions that are off limits to Fed officials and their immediate families. These stocks include Materialize NV, Southwest Airlines, Cava Group, Apple Inc. and Caterpillar.
