Federal Reserve Announces Ethics Investigation After Regional Bank Officials’ Trading
The Federal Reserve said yesterday that it’s breaking out the ol’ ethics guidelines to look into rules surrounding senior Fed officials’ personal investments.
The investigation was launched last week after documents showed that some regional Fed presidents like Boston’s Eric Rosengren held hundreds of thousands of dollars in stocks like Pfizer, Chevron, and AT&T.
- Robert Kaplan, the Dallas Fed President, traded more than $1 million worth of individual stocks last year.
- And Richmond Fed President Thomas Barkin holds somewhere around $1 million in a mutual fund that invests in big names like BP and ConocoPhillips.
It’s not technically against the rules. But it did raise questions as to why three of the 12 regional bank presidents who play a huge role in setting US interest rates and influencing the economy can buy that many Apple shares.
Looking ahead…both Rosengren and Kaplan have agreed to sell their individual stocks, but Senator Elizabeth Warren (separately from the investigation) sent a letter to every regional bank president yesterday asking them to delete their Robinhood accounts and ban all the Fed’s senior officials from trading individual stock. –MM