By Elaine Magliaro
On October fifth, I published a post titled The Case of the Secret Recordings: A Tale about Bank Examiner Carmen Segarra, the New York Fed, and Goldman Sachs. Segarra is a former bank examiner who once worked for the New York Fed. She was hired by the Fed in 2011 “as part of a group of examiners brought on to monitor systemically important banks in the aftermath of the Dodd-Frank regulatory overhaul.” Segarra is the bank examiner who found that Goldman Sachs “lacked an adequate company-wide policy to manage conflicts of interest…” Segarra claims that her superiors at the Fed urged her to change her Goldman Sachs finding. When she refused to comply with their request, she said she was fired.
Investigative journalist Matt Taibbi and Alexis Goldstein of The Other 98% spoke with Ari Melber about Carmen Segarra and the Fed on MSNBC in late September:
SECRET Tapes: NY FED Helping Wall Street BANKSTERS – Matt Taibbi & Alexis Goldstein
After she was fired, Segarra filed a wrongful termination suit. She sued the New York Fed and her bosses—claiming that “she was retaliated against for refusing to back down from a negative finding about Goldman Sachs.”
On October 14th, ProPublica reported that the Fed had “asked for a protective order to seal documents in the case as well as parts of the complaint. In a letter to U.S. District Judge Ronnie Abrams, New York Fed counsel David Gross said the information should be removed from the public docket because it is “Confidential Supervisory Information,” including internal New York Fed emails and materials provided to the Fed by Goldman.
Citing Fed rules that prohibit the disclosure of supervisory information without prior approval of the Fed, Gross wrote, “These documents show that at the time (Segarra) left the employ of the New York Fed, she purloined property of the Board of Governors of the Federal Reserve System.” Propublica said that Gross “argues that the Fed’s obligation to keep bank supervisory records secret outweigh the public’s right to know.” Gross also wrote that “The incantation of a ‘public right to know’ cannot ever be a license to discharged employees that they may violate Federal law simply by filing a complaint in Federal court.”
Propublica said that the “federal judge in Manhattan is pondering whether to grant the request of the New York Federal Reserve to seal the case brought by former senior bank examiner Carmen Segarra.”
Recently, Jessica Desvarieux of the Real News Network spoke with Bill Black regarding the case of Carmen Segarra and the New York Fed. Black is a white collar criminologist, former financial regulator, and an associate professor of economics and law at the University of Missouri-Kansas City. He is also the author of The Best Way to Rob a Bank Is to Own One.
NY Federal Reserve Examiner Fired After Submitting Critical Report of Goldman Sachs