News keeps rolling in about senior Fed officials trading stock when they have extremely valuable inside information. Tally grows of federal judges who did not recuse themselves when they had a financial interest in a case they were hearing. Oh yeah, Chief Justice Roberts of the Supreme Court had his own failure-to-recuse oopsie.
This round of lack-of-integrity-by-senior-officials news reports, federal edition:
- 800 more failure-to-recuse by federal judges. The Chief Justice did not recuse himself until after oral arguments in a case where he had a mere $100K personal investment in one of the litigants.
- Vice Chair of the Fed resigns after news leaks out of timing for his stock trades.
- Previously, two regional bank presidents of the Fed resigned this past October.
PJ media – 1/3/22 – Justice Roberts Talks Judicial Accountability But Fails to Acknowledge Huge Nationwide Problem – The Chief Justice was flapping his gums expounding on how seriously federal judges take their ethical responsibilities, comparing the 685 failures to recuse when federal judges had a financial interest in a case to the 2.5 million cases filed in federal court during the time of those ethical failures.
One of the reporters working on the Wall Street Journal investigation which identified those 685 incidents responded that they could only review a sliver of federal cases. He is confident if they had reviewed all the cases they would’ve found a bunch more ethical lapses.
In fact, the WSJ found 800 additional violations to go with the previous 685, for a total in the range of 1,500 incidents of failure to recuse.
Oh yeah, turns out Chief Justice Roberts had his own failure-to-recuse incident.
Oops.
Back in 2017 he recused himself from a case in which he had more than a $100,000 investment in a litigant making oral arguments. Unfortunately he has such a large portfolio that he didn’t realize he had a $100K position in a litigant when he was participating in the oral arguments.
Author’s conclusion, which I will quote:
“When you take into consideration what kinds of decisions judges are making —whether or not to remove your children from your home, into whose custody to place your children, whether or not you are deprived of your property and freedom — the standards for their behavior ought to be not only printed but enforced. Failure to do so is a stain on this country.”
I will rephrase the point – if those people who have been appointed/ elected/ confirmed to senior leadership positions, such as the Supreme Court, federal judgeship, senior levels of the alleged public health community, and governorships want to be treated with anything other than contempt by the public, they need to quickly rediscover their integrity.
CNBC – 1/10/22 – Fed Vice Chair Clarida to step down early following scrutiny over his trades during pandemic – The Vice Chairman of the Federal Reserve is resigning several weeks in advance of the end of his term.
Unmentioned in Richard Clarida’s resignation letter is additional information surfacing about his brilliantly timed stock trades during the early days of the pandemic. He previously claimed that a number of trades in February 2020 were a preplanned rebalancing of his portfolio.
The New York Times reports he sold shares in three stock funds on 2/24/20 and then repurchased those stock funds on 2/27/20.
In what is no surprise now, it turns out stocks dropped on 2/24/20 over rising concerns from what the pandemic would due to the economy. Uncertainty make the market nervous. Amazingly, on 2/26/20 the Fed met to discuss what steps they would take to support the economy. They decided to take aggressive action to increase liquidity and support the market.
To recap: he sold three stock funds just as the market dropped and repurchased after he was part of decisions to take aggressive steps to support the economy. He sold on the bad news. He repurchased the same positions after he knew the market would soar because of aggressive intervention by the Fed.
Mr. Clarida is the third senior Fed official to resign over insider trading issues.
CNBC – 9/27/21 – Dallas Fed President Kaplan to retire early on October 8, citing trading disclosure “distraction” – Robert Kaplan, who was the president of the Dallas regional Federal Reserve Bank, resigned his position over controversy surrounding his well-timed stock trading.
Announced the same day was the resignation of Eric Rosengren, then the president of the Boston regional Federal Reserve Bank.
Mr. Kaplan denied doing anything wrong. Mr. Rosengren asserted he was leaving because of health and not controversy over his stock trades.
Previous discussion on point:
- 10/22/21 – Updates on insider trading by federal judges and senior staff of Federal Reserve.
- 9/29/21 – Financial conflict of interest on the federal bench and stock trading by presidents of regional Federal Reserve Banks. Alternate headline – Is there any group of powerful people who bother to follow the rules?
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