1. Federal Reserve fines Goldman Sachs $36.3M for use of confidential material

Federal Reserve fines Goldman Sachs $36.3M for use of confidential material

The Federal Reserve is fining Goldman Sachs $36.3 million for what it's calling the use and disclosure of confidential materials that the U.S. uses in its supervision of banks. The Fed ordered the big Wall Street bank on Wednesday to put in place a program that would ensure the alleged violation doesn't happen again.

By: | New York | Updated: August 4, 2016 2:06 AM
Regulators now want to ban Joseph Jiampietro , a former managing director at Goldman, from the banking industry and levy fines against him for the incident that took place more than two years ago. (Reuters) Regulators now want to ban Joseph Jiampietro , a former managing director at Goldman, from the banking industry and levy fines against him for the incident that took place more than two years ago. (Reuters)

The Federal Reserve announced today that it had fined Goldman Sachs USD 36.3 million for improperly obtaining and distributing confidential regulatory information. The Fed faulted Goldman Sachs’s oversight of former senior banker Joseph Jiampietro, who improperly used confidential documents obtained from the US central bank to advise small and medium-sized banks in 2014 on Federal Reserve oversight.

Goldman Sachs in October 2015 already paid a USD 50 million fine to New York state regulators in the case, which shines a light on the dangers of revolving-door staffing among regulators and powerful banks.

Jiampietro, a former regulator with the US Federal Deposit Insurance Corporation, asked a newly hired Goldman employee, Rohit Bansal, to obtain confidential documents from the Fed. The documents were subsequently used to advise bank clients.
Bansal had worked for the Federal Reserve for about eight years prior to beginning at Goldman in July 2014. Bansal received the non-public documents from a former colleague, the Fed said in its order.

In October 2014, Goldman Sachs fired both Jiampietro and Bansal after another Goldman Sachs banker notified the compliance department. The Fed order requires Goldman to enhance its policies and training to ensure compliance with rules on confidential supervisory information.

The Fed also initiated enforcement proceedings against Jiampietro, seeking a fine and to permanently bar him from the banking industry.

 

  1. No Comments.

Go to Top