There is a second (secret) investigation into the 2012 Fed leak, according to the Huffington Post.
Remember the October 2012 Fed leak?
In case you don’t, here’s a refresher: In October 2012, a group of investors received information about the Fed’s September 2012 meeting minutes the day before they were released to the public. At that meeting, the FOMC foreshadowed the December announcement that the Fed would expand its quantitative easing policy.
ProPublica reported back in December 2014 that an “October 2012 newsletter by the market intelligence firm Medley Global Advisors contained detailed and closely held information about what Fed leaders were thinking and what would be in the minutes of an FOMC meeting the day before they were publicly released.”
ProPublica also reported that Bernanke told the FOMC that the committee’s secretary, William English, and the Fed’s general counsel, Scott Alvarez, would conduct an investigation.
Here’s what’s new: The Huffington Post reports that there was (and possibly still is) a second investigation going on, being conducted by the Fed’s inspector general. This investigation has not been disclosed to the public, nor to Congress.
It makes sense that the IG would conduct an investigation. The office’s mission is to conduct “independent oversight by conducting audits, investigations, and other reviews of the programs and operations of the Board and the CFPB.” But it’s strange, according to Huff Po, that the investigation would remain private.
From Huff Po:
According to the person interviewed in the inspector general’s investigation, who spoke on the condition of anonymity, the probe included rounds of interviews in spring 2013 and spring 2014. The IG, which acts as an in-house auditor but is supposed to remain independent of the central bank, has reported neither the inquiry nor the results in any of its regular semi-annual reports to Congress, which are publicly available. These reports serve as the unit’s accounting of its activities and enable the legislative branch to perform its oversight of the Fed.
The source who participated in the investigation said the IG obtained phone and email records of certain Fed employees. Had the leaker used his or her government phone or email account, the investigation would likely have been wrapped up relatively soon: Since only a limited number of Fed officials had access to the leaked information, a review of phone and email records would likely have been possible over the course of just a few weeks. But the duration of the investigation suggests to some that the Fed may not have fully cooperated in the probe.
There are two open questions here: The first is who ordered the investigation. The second is why this investigation was kept secret. Huffington Post suggests it could be because it is still ongoing. If it is a criminal investigation, the IG might be keeping under wraps until there’s some sort of action taken.
In which case, stay tuned.
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