GOP hits Fed on leaks

Janet Yellen in 83 seconds
Janet Yellen in 83 seconds


    Janet Yellen in 83 seconds


Janet Yellen in 83 seconds 01:22

(CNN)The Federal Reserve is famous for its secrecy.

But top Republicans in Congress are worried the central bank isn't doing enough to ward off leaks from its closed-door meetings.
In a letter to Fed Chair Janet Yellen, House Financial Services Committee chairman Jeb Hensarling expressed concern that the central bank lacks "proper internal controls" and accused officials of not being responsive to congressional inquiries about a 2012 leak.
"It appears that proper internal controls are not in place to safeguard the confidentiality of FOMC meeting minutes," Hensarling wrote, "and the resistance the Financial Services Committee has encountered in trying to help shed transparency on this matter is troubling."
    The reported leaks involve an analyst at the market research firm Medley Global Advisors, who is said to have received confidential information from an FOMC meeting in 2012. The analyst appeared to have shared that information with clients in a memo.
    According to the Texas Republican's letter to Yellen, the Federal Reserve's general counsel had previously launched an investigation into the matter, but the "inquiry was dropped at the request of several member of the FOMC."
    Hensarling said the Fed's inspector general is currently looking into the case and that there is now also a pending criminal investigation.
    In another letter to Mark Bialek, the Fed's inspector general, Hensarling said the office of the inspector general has been "withholding" information from the committee related to the ongoing probe into the reported 2012 leak.
    The letters highlight brewing tension between Republicans and Fed officials over whether there is adequate accountability at the Fed. In recent years, GOP lawmakers have pressed for stronger congressional oversight of the central bank.
    Particularly with Republicans controlling both the House and Senate this year, the House Financial Services and Senate Banking committees are expected to give serious consideration to legislative proposals aimed at changing the Fed's policymaking procedures.
    The issue could also come up this week when Fed Chair Janet Yellen holds a televised press conference in Washington, D.C., on Wednesday.
    A Fed spokesperson acknowledged receiving Hensarling's letter, but directed all other questions to the inspector general's office. A spokesman for the inspector general declined to comment.
    Bloomberg first reported on Hensarling's letters.