Goldman Fined $50 Mln For New York Fed Data Theft

Last year, a New York Fed whistleblower released tapes documenting the regulator’s interactions with Goldman.

We are pleased that Goldman Sachs has chose to resolve this matter and work with us to institute reforms that help prevent similar problems from occurring in the future.

Worse, the employee allegedly reached out to a former colleague at the New York Fed to obtain confidential “regulatory or supervisory” information belonging to DFS, the New York Fed or the Federal Deposit Insurance Corporation.

Goldman Sachs Group Inc. agreed to pay a $50 million fine and accepted a three-year ban on a few advisory work in New York as part of a settlement with the state’s financial regulator over the leak of Federal Reserve documents.

When Goldman found out about the insider documents Bansal received, he was let go. USA federal prosecutors are preparing to unveil criminal charges against Mr. Bansal and former Federal Reserve employee Jason Gross, a person familiar with the matter said on Monday.

After he was hired by Goldman in July 2014, Bansal was assigned to a group advising the same mid-sized New York bank that he had been examining during his time at the Fed.

The current head of the New York Fed, William Dudley, is a former Goldman executive. Goldman then fired Mr. Bansal and a more senior employee who had “failed to escalate the issue”, the firm said. Mr. Gross faces a maximum penalty of up to $100,000 and a year in jail, Mr. Barket said.

In a statement, Goldman said it had immediately opened an investigation and notified appropriate regulators when it discovered that Mr. Bansal had confidential information from the Fed. Gross no longer works for the New York Fed. “We have reviewed our policies regarding hiring from governmental institutions and have implemented changes to make them appropriately robust”.

Bansal emailed his supervisor, Joseph Jiampietro, that the managers of the unnamed Goldman client should “keep their cool, not get defensive and not say too much unless the regulators have a blatant fact wrong”, according to the DFS consent order with the bank.

The settlement announced Wednesday between Goldman and the state Department of Financial Services, led by acting superintendent Anthony Albanese, is only the first government action stemming from the leak of confidential documents. The New York Fed said in a statement in November that it has “zero tolerance” for personnel who don’t safeguard confidential information.