Better Markets, a non-profit independent organization promoting public interest in financial markets, has reported that it would welcome any action by the SEC investigating insider trading at the Fed.
On Oct. 6, Dennis Kelleher, co-founder, and President of Better Markets stated that a thorough, independent investigation by the SEC is so important.
He stated that the organization welcomes the SEC’s de facto confirmation of its investigation into the trading during the pandemic by numerous Federal Reserve leaders.
Fed Executives Moving Millions
Earlier this week, it was reported that Federal Reserve Vice Chair Richard Clarida traded millions in and out of securities and mutual funds on Feb. 27, 2020, just one day before Fed Chair Powell issued an emergency pandemic statement.
It was also reported that Dallas Fed President Robert Kaplan and Boston Fed President Eric Rosengren had also actively traded in stocks and real estate assets while the central bank was engaged in an extensive rescue of financial markets as the pandemic worsened. Both Fed executives resigned in late September.
Anti-banking and anti-crypto Senator Elizabeth Warren was particularly incensed and sent a letter to SEC Chair Gary Gensler earlier this week. As she has done with crypto recently, Warren pulled no punches:
“The reports of this financial activity by Fed officials raise serious questions about possible conflicts of interest and reveal a disregard for the public trust. They also reflect atrocious judgment by these officials, and an attitude that personal profiteering is more important than the American people’s confidence in the Fed.”
Tip of The Iceberg
Kelleher echoed the sentiment in his statement yesterday, adding “In addition to violating Fed policies, failing to provide leadership, and violating the public trust by seeking to enrich themselves while their policy actions impacted the price of financial assets, and while apparently in possession of material nonpublic information, this trading may well have violated the law.”
He added that people still have no idea if this trading by a handful of Fed leaders was just the tip of an iceberg of widespread insider trading.
Earlier this week, Gary Gensler said “we as an agency look into things that are brought to our attention,” but did not confirm or deny any of the allegations.
Meanwhile, regulators and a number of hardline politicians still maintain that the crypto industry is the axis of evil when it comes to shady financial dealings.
Featured Image Courtesy of FT