Probe finds Fed official breached ethics rules but did not violate insider trading laws

A government investigation into Atlanta Federal Reserve President Raphael Bostic's securities trades and investments finds he has committed multiple infractions of several of the central bank's ethics policies.

The Fed rules violations "created the appearance" that Bostic had acted on confidential Fed information and that he had a conflict of interest, but the Fed's Office of Inspector General concluded there were no violations of federal insider trading or conflict of interest laws, according to a report issued Wednesday, as per AP.

The probe examined financial trades and investments in a period of roughly five years starting in 2017 that several investment managers initiated on Bostic's behalf-transactions that he said in October 2022, he had not initially been aware of.

Investigators found that securities trades were made on behalf of Bostic multiple times during "blackout" periods around meetings of the central bank's policy-making Federal Open Market Committee. The probe also discovered that Bostic failed to report securities transactions and holdings, or accurately so, on annual disclosure forms.

Bostic once was also out of compliance with a Fed rule of holding no more than $50,000 in US Treasury bonds or notes.

In 2022, Bostic acknowledged that many of his financial trades and investments inadvertently ran afoul of the Fed's ethics rules and he took action to revise all his financial disclosures.

At the time, the Atlanta Fed board accepted Bostic's explanations for the oversights and announced no further actions.

However, Federal Reserve Chair Jerome Powell asked the Fed's Office of Inspector General to review Bostic's financial disclosures.