This page has been archived and commenting is disabled.

"Someone Has To Be Held Accountable", House Committee Presses Fed On Leaks

Tyler Durden's picture




 

When last we checked in with Rep. Jeb Hensarling, the Chairman of the House Committee on Financial Services, he was in the process of learning a frustrating lesson about central bankers in the post-crisis world.

What Jeb might not have realized when he subpoenaed the Fed for information on how the September 2012 FOMC minutes managed to get leaked to Medley Global Advisors (just four months after Janet Yellen met with the firm) is that whatever pretension of accountability the position of Fed chair retained in the lead up to the crisis disappeared entirely when Ben Bernanke 'saved the world' from financial armageddon in 2008. 

Since then, central bankers have become celebrities and like celebrities, are generally above the law, a fact Yellen probably thought she had made clear to Hensarling when she simply refused to cooperate with the subpoena.

As a reminder, here is the sequence of events (from the beginning): 

On October 3, 2012, consulting firm Medley Global Advisors sent a newsletter to clients entitled “Fed: December Bound.”

 

The "special report" essentially constituted an early leak of the minutes from the FOMC's September meeting.

 

Source: ProPublica

 

An internal investigation by then-Chairman Bernanke revealed that some members of the committee had met with the firm that year but the names were not disclosed. On April 15, Congress sent Yellen a letter requesting that the Fed furnish a list of names no later than April 22.

 

That deadline came and went with no response. 

 

On May 4, the Fed acknowledged a DoJ and OIG criminal investigation into the leak, and in the same letter, Yellen admitted that indeed, she had met with the analyst who penned the newsletter at the center of the controversy.

 

Subsequently, The Committee on Financial Services subpoenaed the Fed for records related to the central bank’s review.

 

The Fed has declined to comply in full citing the ongoing criminal investigation. More specifically, Yellen says the OIG has advised the Fed that providing access to the information requested by congress would risk "jeopardizing the investigation."


Well, Hensarling - bless his heart - isn’t giving up and will now interview "a number" of Fed staffers in connection with the leak according to WSJ. Here’s more:

A House panel has lined up “a number” of interviews with Federal Reserve staffers related to the possible leak of confidential information from a 2012 Fed policy meeting, the panel’s chairman said in an interview.

 

House Financial Services Committee Chairman Jeb Hensarling (R., Texas) said the Fed has no legal basis for refusing to comply fully with a subpoena from the committeeon the leak probe. He also argued the Fed has no grounds to invoke “executive privilege,” the authority claimed by the president or other executive branch agencies to avoid releasing certain information.

 

“They are violating the law at the moment,” Mr. Hensarling said.

 

Fed Chairwoman Janet Yellen has said turning over the information at this time could interfere with an ongoing criminal probe of the matter. She said the Fed intends to cooperate as soon as its inspector general, which is conducting the criminal probe with theJustice Department, indicates that doing so won’t compromise their investigation.

 

Ms. Yellen did, however, provide the names of Fed staffers who had contact with the policy information service firm that published the information.

 

“We do have transcribed interviews with a number of witnesses that are lined up, but we haven’t quite seen eye-to-eye on the production of documents,” Mr. Hensarling said, adding that he is trying “to be respectful” and work with the central bank.

 

Asked if the committee may move to hold the Fed chairwoman in contempt—the next step in the process—Mr. Hensarling declined to say.

 

“We want the chair to tell the truth,” he said. “Somebody has to be held accountable.”

We sincerely wish Hensarling the very best of luck in this endeavor but we can’t say we are particularly optimistic about his chances. 

Yellen will give her semi-annual Humphrey-Hawkins testimony to Congress on Wednesday and Thursday this week. Perhaps some brave soul will interrupt the litany of liftoff dialogue with some tough questions about transparency and accountability.

Then again, judging from the response WSJ's Pedro da Costa got when he dared to question Yellen about the leaks, we doubt she'll be very forthcoming if pressed.

*  *  *

Artist's impression of the honorable Chairwoman if questioned about the leak:

 

- advertisements -

Comment viewing options

Select your preferred way to display the comments and click "Save settings" to activate your changes.
Mon, 07/13/2015 - 20:07 | 6308603 Atomizer
Atomizer's picture

Tyler, 

Have a favor to ask. Post this video. It will help people who don't understand the grand scheme of the system. Thank you. It will help those see both sides of the fence. 

Dependency theory - YouTube

Mon, 07/13/2015 - 20:29 | 6308660 NoDebt
NoDebt's picture

Let me take a whack at how this is going to go:

Fed continues to refuse to answer until after the investigation is complete.  Investigation reveals no wrongdoing.  Details of the investigation are sealed by agreement with the DOJ.  Jeb Hensarling continues to sit there with his thumb up his ass for the rest of eternity.

I wonder if Congress can put their finger on the exact moment they became completely irrelevant.  I doubt it.

Mon, 07/13/2015 - 20:32 | 6308665 Meat Hammer
Meat Hammer's picture

December 23, 1913

Mon, 07/13/2015 - 20:58 | 6308748 Solio
Solio's picture

And, here we go a harvesting

across the fruited plain

and what once you thought was your is ours again and again

the children will forever remember

that they were sold on down the drain!

So sorry oh you little ones

forever you'll have pain!

Tue, 07/14/2015 - 01:09 | 6309569 wee-weed up
wee-weed up's picture

"Someone Has To Be Held Accountable"

"What a fukin' hoot!"  ROTFLAO!  -- Jon Corzine

Mon, 07/13/2015 - 21:03 | 6308767 Atomizer
Atomizer's picture

Two more days of consumer shopping. 

April 15, 1912. Titanic sinks to wipe out opposition and create your slave tax payment plan. Don't forget to pay the IRS on April 15th. We are still fighting the same generational people today.  

http://www.history.com/this-day-in-history/titanic-sinks

 

Mon, 07/13/2015 - 20:08 | 6308607 The Delicate Genius
The Delicate Genius's picture

why should th eFed follow the law when our erstwhile Sec of State basically took a shit on every law she could?

OT but this story may or may not be bullshit - but wow.

http://www.boston.com/news/nation/2015/07/13/fbi-isis-supporting-son-pol...

what the fuck, man?

I mean just what the fucking fuck?

Mon, 07/13/2015 - 20:18 | 6308630 disabledvet
disabledvet's picture

Trading on inside information coming from the Fed=Straight to the Holocaust Museum.

State and local Governments have to pay their bills and you are now reading on your own account at their expense.

So now you wish to profit from same said information?

"Hey, Bitch...that's fucking Detroit that just went belly up and now oil prices have collapsed. You better get your fucking ass in line."

She can always resign of course...

Mon, 07/13/2015 - 20:19 | 6308635 Bastiat
Bastiat's picture

"Ciccolo had a “long history of mental illness” and had previously abused alcohol, according to the complaint."

Kid's a nut; that's all.

Mon, 07/13/2015 - 20:22 | 6308639 TheReplacement
TheReplacement's picture

Religion of mentally ill peace.  Yo.

Mon, 07/13/2015 - 20:13 | 6308616 A Lunatic
A Lunatic's picture

<------Truth

<------Nailgun

Mon, 07/13/2015 - 20:16 | 6308626 Chuck Knoblauch
Chuck Knoblauch's picture

Another nobody speaks.

Mon, 07/13/2015 - 20:27 | 6308655 i_call_you_my_base
i_call_you_my_base's picture

TBTF means a merging of state and banking interests. They have likely been feeding their actions all along the way. This is their recapitalization technique, to fleece the market.

Mon, 07/13/2015 - 20:29 | 6308659 PoasterToaster
PoasterToaster's picture

Banking = slavery.  Banks have always been evil and unnecessary.

Mon, 07/13/2015 - 22:31 | 6309110 Wait What
Wait What's picture

dependence on bankers is the primary evil in the world, the reason why societies are failing, generations are suffering. cut off that cancer & you'll see how quickly the patient recovers.

Mon, 07/13/2015 - 20:30 | 6308664 Meat Hammer
Meat Hammer's picture

“We want the chair to tell the truth,” he said. “Somebody has to be held accountable.”

HAHAHAHAHAHAHAHAHAHAHAHAHA!!!!!

*deep breath*

HAHAHAHAHAHAHAHAHAHAHAHAHA!!!!!

Yeah right.

Mon, 07/13/2015 - 20:33 | 6308669 nmewn
nmewn's picture

"We're conducting a very intensive & thorough investigation of the matter ourselves!" - Mr.Yellen said while waving a rainbow flag.

Mon, 07/13/2015 - 20:43 | 6308703 TheRideNeverEnds
TheRideNeverEnds's picture

" The responsible parties were unfortunately lost and subsequently buried at sea in a rather unfortunate yachting accident. ".

"Records too, whole thing was quite tragic. It's better we not talk about it."

Mon, 07/13/2015 - 20:46 | 6308710 CHC
CHC's picture

Hey Congressman - just give the hell up - you can't beat the fucking Federal Reserve.  The ONLY sure way you can beat them is to blow that whole fucking building up and all the other districts up at the same time.  Those people are like fucking cockroaches - they do their dirty work in the dark. 

Mon, 07/13/2015 - 20:48 | 6308718 JailBanksters
JailBanksters's picture

ROFL

All she has to do is go into the Federal Reserve building and close the door. Your not allowed in here.

Mon, 07/13/2015 - 20:49 | 6308720 logicalman
logicalman's picture

Some dude out on bail gets a visit from the uniformed thugs.....

He says he'd like to help, but it might compromise the invstigation he's currently under.

Tasing would be the best he could hope for.

 

Mon, 07/13/2015 - 20:53 | 6308732 Bangin7GramRocks
Bangin7GramRocks's picture

At least this young feller is giving it a good effort. Ol' man Paul didn't do shit when he had the chance. Talked a big game until he became chairman and then he clammed right up like a good little bitch and then quit. Now he collects his evil gubmint pension every month.

Mon, 07/13/2015 - 20:53 | 6308735 Solio
Solio's picture

Accountability, no!

Harvesting, yes!!

 

Won't you help?

Mon, 07/13/2015 - 20:54 | 6308738 are we there yet
are we there yet's picture

Lois Learner of the IRS, Eric Holden of the justice dept, all FED heads, Hillary and friends all are open about ignoring congressional subpenas. To a large extent congress is becoming progressively removed from its function. 

Mon, 07/13/2015 - 21:01 | 6308753 Gold...Bitches
Gold...Bitches's picture
"Someone Has To Be Held Accountable"

 

Pure Comedic Genius.  That's an act that can make it on the road I tell ya.

Mon, 07/13/2015 - 21:01 | 6308760 GoldenDonuts
GoldenDonuts's picture

There must be a twenty year old intern working for the summer that they can hang it on.

Mon, 07/13/2015 - 21:07 | 6308782 Ness.
Ness.'s picture

They (Jeb) should have arranged for Heraldo Riviera to tunnel into WT7 about, oh, say sometime in August of 2001.  That might have actually accomplished something.  Fuck these idiots and their fake 'anger' games.

Stars and bars.

Mon, 07/13/2015 - 21:11 | 6308801 Yen Cross
Yen Cross's picture

  I'm beginning to wonder if someone leaked the U.S. retail sales numbers for tomorrow. /sarc

 It kinda feels like the $usd, and equity market longs are getting set up for a shitty number. ;-)

Mon, 07/13/2015 - 21:19 | 6308838 Atomizer
Atomizer's picture

Janet Yellen, 

If the economy is so stable, raise the rates on July 14, 2015. You won't. Because everyone knows about the Ponzi scheme. Printing counterfeit money is illegal. Yet you continue to do it for the cartel of criminals. 

Why not safehaven El Chapo to keep Quantitative Easing going as plan. We took out Pablo Escobar. Do you remember? The US banking laundering system collapsed. Do you recall Janet Yellen? 

Mon, 07/13/2015 - 21:24 | 6308862 Atomizer
Atomizer's picture

Janet Yellen,

El Chapo will die shortly. What are you going to do without the drug running gravy train? 

Mon, 07/13/2015 - 21:43 | 6308932 Frankie Carbone
Frankie Carbone's picture

Look at Yellen giving him the finger in that photo. 

Jesus, that's arrogant. 

Mon, 07/13/2015 - 21:51 | 6308956 kchrisc
kchrisc's picture

"Someone Has To Be Held Accountable", House Committee Presses Fed On Leaks"

I nominate Cozine.

Liberty is a demand. Tyranny is submission..

Mon, 07/13/2015 - 22:43 | 6309158 Not if_ But When
Not if_ But When's picture

And they want to take Andrew Jackson off the $20 bill.  The man was one of the very earliest to confront the Fed's backers.  Too bad it made no difference in the long run.

Tue, 07/14/2015 - 00:34 | 6309489 GeorgeHayduke
GeorgeHayduke's picture

Accountability is for the peons, not the power brokers. Look at 9/11 for the most glaring example. Not a single person canned or demoted for that fiasco. In fact most everyone involved got a promotion. After all, they helped cover up one of the biggest thefts of all time.

So my question is do we just have no accountability anywhere in the lofty world of the power brokers, or is this all going as they planned so they see no need to hold anyone accountable? Or, has it gotten to the point that expectations are so low about anything going as planned, except corruption, that everyone just figures everything's a loser out of the gate, so why bother with accountability since it's going to fail anyway? I do not have the answer, but I do see the shit pile from this rapidly failing, corrupt to the core system growing larger by the day.

Tue, 07/14/2015 - 10:18 | 6310638 libertysghost
libertysghost's picture

I thought I was writing that first paragraph!  It's great someone else notes that point about 9/11 as to me, it has been the most powerful point I can use to people otherwise wanting to disregard any questioning as of course...we all know..."it's just those conspiracy theory nuts again".  

So if anyone cares, here's my strategy in conversations about accountability and corruption with people labeling themselves all stripes.  Everyone claims corruption is horrible, but usually they want to make it more about "the people who support the other party/President" who are "much more corrupt". 

So I talk about incentives.  I have a conversation where we can generally agree that people in power will always seek more powwer for themselves...a few famous quotes gets them rolling too on this theme with plenty of nods of yes, yes yes.

Then I might sprinkle in a few smaller cases of people who they think are the "bad guys from the other political side" where they weren't held accountable.  Then I bring in what I call, "probably the most glaring example of lack of accountability is killing our country is...9/11".  "Lets say everything happened that day exactly how the 9/11 Commission said it did, no matter...historically (I'm a historian by trade) it is the largest defense failure in American history---bar none.  Even Pearly Harbor doesn't come close given the resources we had put in our national defense for decades prior, the fact this happens in the urbanized lower 48 states and not the fringe like Hawaii, and the knowledge and planning for similar types of attacks we know took place prior to 9-11 by our various government agencies and military."  

"Given all of that, why was no one held accountable?  Not one person was fired for incompetance after the largest defense failure in US history?  How can we justify that?  AND...not only was no one fired, people and agencies and their cronies in corporations were rewarded with new giant agencies (Homeland Security), massive budget increases and more power to take away our personal freedoms!"

Then I finish with the point anyone mildly familiar with economics or human psychology will understand:

"So what incentive does "the system" or anyone with power in "the system" have to stop a terrorist attack?  There won't be any accountability...they won't lose their jobs if they don't stop it...and history shows that they will likely get more of our money and consolidate more power if they let it happen."

"That's why accountability is so important."

I've found there is no argument against this that doesn't sound insanely elitist of fairy tale like which even the biggest sheeple run away from.  No one has tried.  And in the end, it not only makes the point of how it doesn't matter if you think it is "your guy" or not because this was everyone in power in this example.  And finally, it's not a big leap for people to start thinking "wow, there is a very simple reason things like this can be done from the inside or let to happen and it's not really a giant conspiracy, it's just self-interest and institutional culture."

Tue, 07/14/2015 - 02:45 | 6309701 Consuelo
Consuelo's picture

Poor, frustrated Goy Hensarling.   Doesn't he know...?  This lot has a thousand gordian knots for him to untie before he gets anywhere near the truth.   Thus it has been since Moses shattered the tablets in frustration.    If however, he can stand the heat and keep pushing...

Tue, 07/14/2015 - 08:43 | 6310282 venturen
venturen's picture

will be offered a job/advisery at Goldman....for an undisclosed sum. Case closed

Wed, 07/15/2015 - 10:15 | 6315071 Fahque Imuhnutjahb
Fahque Imuhnutjahb's picture

Leak-Schmeak!  This is sensitive information of a tribal nature, not to be trifled with by ordinary gentilemen. 

Do NOT follow this link or you will be banned from the site!