Elizabeth Warren demands SEC investigate Fed officials’ investments, saying their transactions could be insider trading

• Sen. Elizabeth Warren called on the SEC to investigate trades by three Fed officials.
• "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," Warren wrote.
• Warren also laid into Powell, a week after she vowed to oppose his re-appointment and called him a "dangerous man."
• See more stories on Insider's business page.

Massachusetts Sen. Elizabeth Warren called on the Securities and Exchange Commission to investigate controversial trades by three Fed officials in a letter to the agency on Monday.

The two outgoing Fed officials, Boston Fed President Eric Rosengren and Dallas Fed President Robert Kaplan, resigned last week after disclosures emerged showing that the two men made active investments while in office. Rosengren cited health reasons for his resignation, while Kaplan made reference to the ongoing scandal.

In a separate set of disclosures last week, Fed Vice Chair Richard Clarida reportedly moved cash between funds a day before Fed Chair Jerome Powell issued a statement signaling future interest rate cuts. Clarida has not resigned from his post, and a Fed spokesperson said the transactions were "pre-planned" and had received "prior approval" from ethics officials.

Warren's letter called the three men's transactions "ethically questionable" and called on the SEC to investigate further.

"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," Warren wrote. "If they involved 'purchasing or selling a security while in possession of material nonpublic information' … they may have violated SEC's insider trading rules."

Warren also laid into Powell, a week after she vowed to oppose his re-appointment and called him a "dangerous man."

"It is not clear why Chair Powell did not stop these activities, which corrode the trust and effectiveness of the Fed," she wrote in the letter. "The Fed officials' trades clearly run afoul of Fed guidelines."

Powell has said that the Fed will re-evaluate its ethics rules, acknowledging they are not wide-ranging enough.