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Author
Martin Crutsinger
Date
August 29, 2013

Fed’s IG says central bank violated document rules

WASHINGTON (AP) — The Federal Reserve’s inspector general says the Fed violated its own rules for handling sensitive material when it inadvertently issued the minutes of a policy meeting a day before the scheduled release.

The IG’s report Thursday recommended procedural changes after the Fed minutes were sent a day early to more than 100 congressional staffers and financial industry lobbyists.

The recipients of the March minutes included congressional staffers and employees of JPMorgan Chase, Goldman Sachs Group, Wells Fargo and other large banks.

The minutes had been scheduled for release at 2 p.m. April 10. The Fed discovered that they had been inadvertently emailed a day early by a staffer in its congressional liaison office. The Fed then released the minutes to the public and the news media five hours earlier than scheduled.

The IG’s report said the Fed failed to provide sufficient training to employees in handling confidential information. It also said the Fed failed to properly limit access to employees who need to know the information ahead of the public.

In response to the IG’s report, Fed officials said they had changed how they handle sensitive material such as the minutes of the Federal Open Market Committee, the committee that sets interest rate policies.

“We believe that the steps the (Fed) board has already taken, coupled with improvements being developed, will strengthen the board’s information security,” Fed officials Michelle Smith and William English said in a statement.

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