Goldman Sachs has settled a confidential leak investigation case with the Federal Reserve Bank of New York, agreeing to pay a $36.3 million fine. The New York Fed fined and permanently barred former Goldman Sachs Managing Director Joseph Jiampietro from the industry. Jiampietro was the supervisor of an employee who obtained Federal Reserve secrets and used them to the bank’s benefit in sales presentations to solicit new clients.

Goldman Sachs

Goldman employee boldly used confidential Fed data in sales presentations

The Fed charges stated that “a Firm employee engaged in the criminal theft of confidential supervisory information of the Board of Governors and other banking regulators,” taking this information and disseminating it among numerous employees and potential clients.

Rohit Bansal was a former New York Federal Reserve Bank employee for seven years before joining Goldman in 2014. In his new position at Goldman, Bansal was assigned to consult with smaller same banks whom he regulated while at the New York Fed. While a Goldman employee he received confidential Fed information about a bank client he supervised and took the bold step of using components of the confidential Fed data he received in sales presentations to solicit other bank clients.

“Goldman Sachs provides regulatory advisory services to supervised financial institutions relating to capital stress testing and other supervisory issues, and the Firm was aware that in such circumstances the Firm was prohibited from using or disclosing the Board’s confidential supervisory information absent regulatory approval,” the Fed charges stated.

Bansal was fired by Goldman in 2014 and when the firm discovered the infraction they reported it to regulatory officials. Jiampietro was Bansal’s immediate supervisor.

Jiampietro plans to fight charges, says he was unaware of Bansal’s scheme

Jiampietro, who was also fired by Goldman in 2014, exhibited “personal dishonesty,” the Fed said, and he was fined $337,500. Jimpietro was a former adviser to former Federal Deposit Insurance Corporation Chair Shelia Bair. The financial windfall Goldman received as a result of the action was unknown but ZeroHedge notes the fine is but a mere 0.01% of the bank’s total revenues.

Goldman had previously paid a $50 million fine for the same infraction, bringing the total cost of the incident to $86.3 million.

Jimpietro, for his part, is fighting the charges.

“The allegations filed against Mr. Jiampietro are demonstrably false,” Adam Ford, a lawyer representing Jiampietro at Ford O’Brien LLP, was quoted as saying. He claims Jiampietro “never requested confidential supervisory information from anyone, and never used it for his or anyone’s benefit. The Fed has the law wrong and the facts wrong.”