A former high-ranking official at the Federal Reserve claimed that her husband engaged in trading activity that violated the central bank’s rules in a newly released ethics report.
The US Office of Government Ethics revealed in a lengthy report on Saturday that Adriana Kugler, 56, purchased stocks and made trades ahead of Federal Open Market Committee meetings, according to the public findings.
The office concluded that Kugler broke the rules that prevent stock trading close to meetings where interest rates are set.
The findings come three months after Kugler abruptly submitted her resignation as a member of the Federal Reserve Board.
The investigation began last year, and Kugler disclosed in September 2024 that the violations were unknowingly committed by her husband.
‘Consistent with her September 15, 2024, disclosure, 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 report reads.
Kugler is married to Ignacio Donoso, a business immigration lawyer based in Maryland.
The Federal Reserve is the central bank of the US, responsible for the nation’s monetary policy, promoting financial stability, regulating financial institutions, and protecting consumers.
Adriana Kugler said her husband, immigration lawyer, Ignacio Donoso (pictured), carried out trading activity that she was unaware of
Kugler told the ethics committee that her husband didn’t intend to violate trading rules or policies
Kugler was nominated by President Biden to the Board of Governors in 2023 and later confirmed by the Senate (Pictured: Kugler with Senator Chuck Schumer)
The system comprises the 12 Federal Reserve Banks, the Board of Governors, and the Federal Open Market Committee.
The seven governors serve staggered 14-year terms and are nominated by the President and confirmed by the Senate.
Kugler was nominated by President Biden and was confirmed in September 2023. She handed her resignation to President Trump over the summer, who said at the time that he was ‘very happy’ to have an open slot on the board.
Trump then nominated Stephen Miran, one of his economic advisors, as her replacement.
The report concluded that Kugler sold shares in stocks for Apple, Southwest Airlines, and Cava during the Federal Reserve’s ‘blackout period.’
The period spans approximately 10 days before a Federal Open Market Committee meeting and extends to a day after. FOMC meetings set interest rates and can affect the prices of stocks and bonds.
During this time, officials are banned from trading or discussing monetary policy with the public.
The Office of Government Ethics found that Kugler purchased shares in Cava just a week before a policy meeting in March and sold them in April.
She then bought and sold Cava shares two more times by May and purchased stock from Southwest in March.
Kugler resigned from her position in August after missing a Federal Open Market Committee meeting in July
Kugler came under fire for purchasing the stocks last September
She sold the Southwest shares the day before a meeting that began on April 30. Kugler also purchased between $100,000 and $250,000 shares of Apple in April.
Officials and their family members are also prohibited from buying and selling stocks and short-term trades.
The rules were enacted in 2021 when Chair Jerome Powell tightened restrictions on federal officials.
The Federal Reserve also adopted rules that banned officials from trading in individual stocks and bonds, and cryptocurrencies in 2022.
The new rules came into effect after Eric Rosengren and Robert Kaplan left their positions, following accusations that they had traded stocks before the central bank adopted measures in response to the Covid-19 pandemic.
Kugler came under fire for purchasing stocks in Cava and Apple last September, stating in another ethics report at the time: ‘These four purchases were carried out by my spouse, without my knowledge, and I affirm that my spouse did not intend to violate any rules.
‘Upon learning about the purchases, I immediately notified ethics officials, and at their direction, I initiated divestiture of these assets as soon as possible under FOMC ethics policies.’
Also in May, Kugler requested a waiver for a standard extension for filing annual ethics disclosures, which was denied.
She didn’t participate in the FOMC meeting in July and announced her resignation on August 1, which took effect just a week later.
The report cited that Kugler violated trading rules by selling shares in Cava and Apple
The ethics report concluded that Kugler purchased stock from Southwest in March
Federal Reserve Chair Jerome Powell tightened rules on purchasing and selling stock for officials in 2021 and 2022
‘It has been an honor of a lifetime to serve on the Board of Governors of the Federal Reserve System,’ Kugler said at the time.
‘I am especially honored to have served during a critical time in achieving our dual mandate of bringing down prices and keeping a strong and resilient labor market.’
Powell said in a statement that he appreciated Kugler’s service and commended her ‘impressive experience and academic insights.’
Kugler then started a position as a professor at the McCourt School of Public Policy and Economics at Georgetown University.
The Daily Mail has reached out to Kugler and the Federal Reserve for comment.