A newly released federal ethics review has found that former Federal Reserve Governor Adriana Kugler made multiple stock transactions in 2024 that violated the central bank’s ethics rules, including several trades executed during prohibited blackout periods.
According to The Associated Press, the findings were published Saturday by the U.S. Office of Government Ethics, which examined Kugler’s 2024 financial disclosure documents after the Federal Reserve referred the matter to its inspector general earlier this year.
Kugler, who unexpectedly resigned from the Fed board on Aug. 8, reported more than a dozen individual stock trades, despite rules barring such investments by top Fed officials.
Among the transactions disclosed were trades in Southwest Airlines, Apple, Caterpillar, and Fortinet. The largest was an April 2024 purchase of Apple stock valued between $100,000 and $250,000.
The timing of several trades raised particular concern, as they took place during financial trading “blackout periods” — the restricted windows surrounding the eight annual meetings when the Fed sets interest rates and reviews monetary policy.
Federal ethics rules prohibit governors from investing in individual stocks, bonds, or cryptocurrencies, allowing only diversified holdings, such as mutual funds. They must provide 45 days’ notice, obtain approval for trades, and publicly disclose transactions made in the preceding 30 days.
Trading during blackout periods, which span roughly 10 days before and one day after policy meetings, is strictly forbidden due to the market-moving nature of Fed decisions.
Kugler’s filings showed a sale of Palo Alto Networks stock between $50,000 and $100,000, along with a purchase of Cava Group shares worth $1,000 to $15,000 — both in March 2024, less than a week from that month’s Fed meeting.
She also reported an additional Cava Group purchase in April, as well as the sale of $15,000 to $50,000 in Southwest Airlines stock during the blackout window leading up to the April 30 meeting.
The ethics report noted that “certain trading activity was carried out by Dr. Kugler’s spouse, without Dr. Kugler’s knowledge, and she affirms that her spouse did not intend to violate any rules or policies.”
The Federal Reserve tightened its investment rules in 2022 after public outcry over questionable trades by several senior officials. That same year, Federal Reserve Bank of Atlanta President Raphael Bostic acknowledged past violations and revised his financial disclosures back to 2017, saying the trades were executed by investment managers without his knowledge.
Kugler, appointed in September 2023 by former President Joe Biden and the first Hispanic member of the Fed’s Board of Governors, returned to her faculty position at Georgetown University following her resignation. Her vacant seat was filled in September when the Senate confirmed Stephen Miran, one of President Donald Trump’s top economic advisers, to the central bank’s governing board.
