I rail from time to time on the breaches of law or policy that result in corporate fines but no individual accountability. So I was relatively happy to see “Goldman Pays Up Over Leak,” The Wall Street Journal, August 4, 2016 C1.
A staffer at the Federal Reserve in New York leaked confidential government information to a former colleague, who then worked at Goldman Sachs. Another Goldman Sachs executive knew about the leak of the information and failed to report it to his superior.
- The staffer who leaked the information got fired and fined $2,000.
- His former colleague pled guilty to theft of government property (and not receiving stolen goods), was barred from the banking business for life, and fined $5,000.
- The Goldman Sachs executive who knew but didn’t tell – he was fired, and faces a proposed fine of $337,500 and a lifetime bar from the banking industry (his lawyer says he’s fighting the allegations).
- Goldman Sachs paid $50 million to New York State and $36+ million to the Federal Reserve.
Quoting from The Journal, “[t]he Fed said it is ‘illegal to use or disclose confidential supervisory information without prior approval of the appropriate banking regulator.'” The article did not provide a regulatory citation for this requirement.
So, the relatively good news is, while the shareholders of Goldman paid the majority of the penalty, at least the actual perpetrators paid something. What percentage of $86 million is $2,000?