Fed Unable To Comply With Congressional Subpoena Due To Criminal Probe

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, at which the central bank launched the third installment of QE.

An internal investigation by then-Chairman Bernanke revealed that indeed, 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. Now, 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."

Note the irony: the Fed says it cannot comply with a Congressional subpoena regarding an alleged leak due to the fact that producing the requested documents could ultimately result in... a leak. In any event, the full letter is below. 

Hensarling Letter 20150604