A top fed official has stepped down from his post after admitting he may have reveled classified information.
Federal Reserve Bank of Richmond President Jeffrey Lacker announced he has resigned from the position of the head of the Richmond Fed due to the incident and the criminal investigation that surrounded it.
Originally, Lacker, who was outspoken about higher short-term interest rates, planned to retire in October. But the new revelations forced him to step down as a search committee looks for a new president.
Here’s what you need to know About Lacker:
1. Lacker Said He May Have Revealed Classified Information
Lacker released a one-page statement April 4 admitting that in 2012, he “may have” disclosed confidential information about the Fed system’s options to an analyst from Medley Global Advisors.
According to a report from Reuters, Medley sent out details of a “September Fed policy-setting meeting” hours before the U.S. central bank even published it.
At the Fed meeting days after the conversation, government officials discussed a large bond-buying policies that would be initiated in the coming months; what Medley had tipped-off.
It’s speculated that Lacker’s classified leak to the Medley analyst assisted traders and gave them an unfair advantage.
After the move, Medley came under fire as people tried to figure out where the leak came from. A criminal investigation was launched into the classified leak from the Federal Reserve by the U.S. Department of Justice as a result.
In his resignation letter, Lacker said that he never intended on leaking classified information in the conversation.
2. Lacker Started Working for the Bank In 1989 & Assumed the Role of President In 2004
Before becoming the president of the Richmond Fed, Lacker had many other roles with the bank.
He first joined the Fed in 1989 as an economist and was promoted to a research officer five years later in 1994. Two years after that in 1996, he was promoted once again.
He became the Richmond Fed’s president in August 1, 2014 and served as a voting member of the Federal Open Market Committee, which votes makes on federal policy decisions.
When the FOMC opted to keep interest rates at 5.25 percent after steady increases, Lacker wanted to tighten them. He has cast a number of dissenting votes in his time as a member.
At a January 2009 meeting about keeping the rates as is, Lacker said he dissented because he “preferred to expand the monetary base by purchasing U.S. Treasury securities rather than through targeted credit programs.”
In addition, Lacker was the only one to vote against quantitative easing via purchasing mortgage-backed securities in September 2012.
Then in September 2015, he was the only member that voted in favor of hiking interest rates.
3. Before Working at the Fed, Lacker Was an Economics Professor & a Scholar
Lacker earned his bachelor’s degree in economics from Franklin & Marshall College in Lancaster, Pennsylvania. After graduation, he went on to earn his doctorate in economics from the University of Wisconsin-Madison.
Before joining the Fed, Lacker worked as an assistant professor of economics at Purdue University’s Krannert School of Management. Prior to that, he worked at Wharton Econometrics in Philadelphia.
Lacker also taught economics for a year (1992-93) at The College of William and Mary and was a visiting scholar at the Swiss National Bank in 1997.
4. He’s the Author of Many Pieces On Economics
Economics have always been Lacker’s focus throughout his lifetime.
When he’s not studying or educating, he’s writing. Lacker’s been the author of many pieces on economics and spending. He wrote numerous articles in professional journals of monetary, financial and payment economics and has been a speaker/presenter at many colleges and central banks.
Lacker is on the board of the Richmond Fewish Foundation and is the director of the World Affairs Council of Greater Richmond and Richmond’s future. He’s also on the board of trustees for the University of Richmond.
5. Lacker Is Married & Has Two Children
Lacker was born in Lexington Kentucky and is married to Lisa Halberstadt. Lisa’s father, Jack, was well-known in Pennsylvania. He opened up a financial advisory firm, called Halberstadt Financial Consultants, Inc. in the 1980s.
Jeffrey and Lisa have two sons, Benjamin and Daniel.