An investigation into the financial activities of Atlanta Federal Reserve President Raphael Bostic revealed that he violated several of the Fed’s ethics policies.
According to a report released Wednesday by the Fed’s Office of Inspector General he ,however, did not break federal insider trading laws.
The probe, which covered a five-year period starting in 2017, found that Bostic created the appearance of acting on confidential information and having a conflict of interest. It uncovered that trades were made on Bostic’s behalf during “blackout” periods surrounding Federal Open Market Committee (FOMC) meetings, when Fed officials are prohibited from trading securities. The investigation also found that Bostic failed to accurately report his financial transactions on disclosure forms and at one point exceeded the Fed’s limit on US Treasury holdings.
However, the inspector general concluded that Bostic did not violate insider trading laws, as he was not personally directing the trades and relied on third-party investment managers. Bostic had acknowledged the errors in October 2022, saying he was initially unaware of the trades made on his behalf.
In response to the report, the Atlanta Fed’s board said it takes the findings seriously and will discuss the matter further. The investigation into Bostic’s financial disclosures follows previous controversies involving other Fed officials, which led the central bank to tighten its rules on trading by top policymakers in 2021.
Bostic has served as president of the Atlanta Fed since 2017 and is a voting member of the Fed committee that sets US interest rates. The inspector general’s report has been referred to the Federal Reserve Board for any further action.
The Associated Press, Reuters, and Market Watch contributed to this report.
