One week ago we were stunned to learn, and report, that as part of the "sentencing" of former NY Fed employee Jason Gross who had admitted to stealing confidential Federal Reserve information and passing it on to his former boss Rohit Bansal, then employed at Goldman Sachs, in hopes of generating goodwill and a comfortable post-Fed job at 200 West, he somehow managed to avoid any jail time and instead was slapped with a draconian penalty: a $2,000 fine.... oh and some community service.
The sentencing judge, U.S. Magistrate Judge Gabriel Gorenstein, explained his ludicrous decision by saying his treatment of Gross sent "a powerful message to others." Right - a message that if you steal from the Fed and hand over the information to a potential future employer, you will never go to prison but instead will pay a token fine and dig some trenches. And that's if you get caught.
While we were disgusted with the lack of justice for Gross, we knew we would be even more disgusted once his co-conspirator, former NY Fed and Goldman employee, Rohit Bansal, was sentenced earlier today. We said that "as for Bansal, who also pleaded guilty in November to theft of government property, he is scheduled to be sentenced on Tuesday. We expect he too will avoid prison time."
This, too, turned out to be 100% correct.
As we predicted one week ago, and as Bloomberg reported moments ago, Rohit Bansal avoided prison time, and instead was sentenced to two years’ probation after pleading guilty to a misdemeanor. U.S. District Judge Gabriel Gorenstein at a sentencing hearing in Manhattan also ordered Bansal to perform 300 hours of community service and pay a $5,000 fine.
Rohit Bansal, who prosecutors said should get as long as a year in prison, pleaded guilty last year to obtaining about 35 documents on about 20 occasions from his friend Jason Gross, who was employed at the New York Fed, according to a settlement last year between New York-based Goldman Sachs and the New York Department of Financial Services.
How did both former NY Fed employees avoid spending even one day in prison between them? "Bansal asked that he be sentenced to no prison saying he’d made "significant" efforts to make up for his misconduct by agreeing to help regulators and the government when first approached by authorities. He also said he continued to cooperate with the Board of Governors of the Federal Reserve system in its related independent investigation."
So... he settled, just as his NY Fed leaker Jason Gross did, and the outcome was... no prison time for both of them! Just how is this considered equitable justice, or a quid-pro-quo by the US government is not clear, because ultimately the only "punishment" for both of them was some pocket change and hanging out in the open air, planting trees.
As a reminder, Bansal worked at Goldman Sachs from July 2014 until October 2014 where he provided advice on regulatory issues to bank clients, including banks supervised by the New York Fed. Prior to joining Goldman, Bansal worked at the Fed from about August 2007 to March 2014.
As for Goldman, it itself agreed to pay a $50 million fine and accepted a three-year ban on some advisory work in New York as part of a settlement with the state regulator. The bank admitted it failed to properly supervise the employee. What it really admitted to was knowing full well it was receiving stolen NY Fed information and thus enriching itself illegally. Which, for the biggest hedge fund incubator of central bankers is nothing new.
As is nothing new the final tally of corrupt, criminal bankers who are going to prison as a result of this grotesque crime: zero.