Federal Reserve advisor spied for China, DOJ says

A former senior advisor for the Federal Reserve was arrested Friday on charges that he conspired to steal Fed trade secrets for the benefit of China.

The data that the advisor John Harold Rogers allegedly shared with his co-conspirators could allow China to manipulate the U.S. market “in a manner similar to insider trading,” according to the U.S. Attorney’s Office in Washington, D.C.

“Gaining advance knowledge of U.S. economic policy, including advance knowledge of changes to the federal funds rate, could provide China with an advantage when selling or buying U.S. bonds or securities,” the office said, noting that China holds about $816 billion of U.S. government debt.

Rogers’ two alleged co-conspirators were members of China’s intelligence and security apparatus who posed as graduate students at a university in that country, prosecutors said.

Those conspirators allegedly gave him gifts, arranged and paid for a beach vacation for Rogers, and also arranged and paid for his airfare, loading and meals during his visits to China.

Rogers, a 63-year-old resident of Vienna, Virginia, was indicted in D.C. federal court on charges of conspiracy to commit economic espionage and making false statements. He faces a maximum possible sentence of 15 years in prison if convicted of the espionage charge.

The case was announced on the same day that the White House said that President Donald Trump would impose tariffs on China, as well as on Canada and Mexico, on Saturday.

Rogers worked as a senior advisor in the international finance division of the Federal Reserve Board of Governors from 2010 until 2021, U.S. Attorney’s Office said.

As part of that job, he “was entrusted with confidential FRB information,” according to prosecutors.

Rogers since 2018 allegedly exploited his employment “by soliciting trade-secret information regarding proprietary economic data sets, deliberations about tariffs targeting China, briefing books for designated governors, and sensitive information about Federal Open Market Committee … deliberations and forthcoming announcements,” the U.S. Attorney’s Office said.

The FOMC is responsible for setting the federal funds rate — the interest rate banks charge one another for short-term loans. FOMC decisions on that rate can significantly affect U.S. financial markets.

The indictment accuses him of passing that information electronically from his personal email, in violation of Fed policy, or printing it out prior to traveling to China to meet with co-conspirators.

“Under the guise of teaching ‘classes,’ Rogers met with his co-conspirators in hotel rooms in China where he conveyed sensitive, trade-secret information that belonged to the FRB and the FOMC,” the U.S. Attorney’s Office said.

Rogers in 2023 was paid about $450,000 as a part-time professor at a Chinese university, the indictment notes.

The indictment alleges that in February 2020, in response to questioning the Fed’s inspector general’s office — the central bank’s internal watchdog — “Rogers lied about his accessing and passage of sensitive information and his associations with his co-conspirators.”

FBI Assistant Director in Charge David Sundberg in a statement said, “The Chinese Communist Party has expanded its economic espionage campaign to target U.S. government financial policies and trade secrets in an effort to undermine the U.S. and become the sole superpower.”

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