Republicans on the House Financial Services Committee say an official investigation into a leak of confidential, market-moving information at the Federal Reserve was “inadequate.”
Committee Chairman Jeb HensarlingThomas (Jeb) Jeb HensarlingLawmakers battle over future of Ex-Im Bank House passes Ex-Im Bank reboot bill opposed by White House, McConnell Has Congress lost the ability or the will to pass a unanimous bipartisan small business bill? MORE (R-Texas) and Rep. Sean DuffySean DuffyTrump pushing ex-Rep. Duffy to run for Wisconsin governor Fox News signs book deal with HarperCollins First lady's press secretary calls on Rachel Campos Duffy, Fox News to apologize for host's comments MORE (R-Wis.), who leads the panel's Oversight and Investigations Subcommittee, vowed Tuesday to launch their own investigation into the central bank's handling of the October 2012 leak.
“The Federal Reserve's investigation of this important matter was inadequate,” Hensarling and Duffy wrote in the letter to Federal Reserve Chairwoman Janet Yellen, released publicly this week and first reported by Bloomberg.
Federal Reserve general counsel Scott Alvarez briefed committee staff in March about his investigation into the October 2012 leak to Medley Global Advisors of confidential central bank meetings.
In an Oct. 3, 2012, note to clients, Medley officials published the information in an advisory to clients, launching concerns about how Washington insiders dole out what is known as “political intelligence” inside the Beltway.
“Although Mr. Alvarez conceded that the leak could constitute a crime, at no time did he or any member of the [Fed's policymaking board] refer the matter to the Federal Reserve Office of the Inspector General, the Federal Bureau of Investigation, the Department of Justice, the Securities and Exchange Commission, or the Commodity Futures Trading Commission,” Hensarling and Duffy wrote to Yellen.
Alvarez told committee staffers that the Fed's internal security policies do not provide guidance about how such circumstances should be referred to regulatory agencies.