UPDATE: April 7, 2022: The Federal Reserve on Thursday said it banned Joseph Jiampietro, a former Goldman Sachs managing director, from the banking industry over his unauthorized use and disclosure of central bank secrets.
Goldman fired Jiampietro in 2014 for failing to tell his bosses that a junior employee, Rohit Bansal, who previously worked at the Federal Reserve Bank of New York, emailed him confidential reports, including ones pertaining to bank examinations.
The Fed said Jiampietro developed a consultancy practice at Goldman that advised midsize and regional banks on potential mergers and compliance matters such as stress tests, according to Bloomberg.
Goldman's compliance department found the private documents on Jiampietro's desk when it investigated — but he contended at the time that he didn't read them, The New York Times reported. Goldman also fired Bansal.
Bansal and his source, Jason Gross, each pleaded guilty to stealing government property and were barred from the banking industry.
The Fed said in August 2016 it would pursue a $337,500 fine against Jiampietro and a permanent banking ban. But by 2018, Jiampietro sued the Fed and asked a federal court to halt the move to ban him because it was taking too long. Jiampietro also sued Goldman, seeking at least $350,000 in legal fees.
Goldman, for its part, paid a $50 million penalty to New York’s Department of Financial Services and accepted a three-year ban on some advisory work in the state as a result of the document leak. The Fed also fined the bank $36.3 million in relation to the case.
“Mr. Jiampietro left the industry seven years ago to pursue other endeavors," Adam Ford, a lawyer for Jiampietro, said Thursday in a statement seen by the Financial Times. "He fought every day to clear his name, but given the lapse of time and his future plans the endless litigation no longer made sense. He is glad to put it behind him in the manner he did.”
In its order Thursday, the Fed said Jiampietro agreed to the ban but neither admitted nor denied the allegations.
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The Federal Reserve Board on Tuesday banned four former Regions Bank employees and two ex-Merrill Lynch Wealth Management employees from working in the banking industry after it said they submitted fraudulent applications for Economic Injury Disaster Loan (EIDL) assistance and "used the funds for unauthorized personal expenses."
Tracy Mallory, a former branch manager at a Regions location in Albany, Georgia, obtained a $11,600 loan through the Small Business Administration (SBA) program, and a $10,000 grant — together, the largest sum among the banned bankers — between July and October 2020, the Fed said.
Wendy Rodriguez Legon, a former financial relationship specialist at a Miami branch of Regions, received a $15,800 EIDL, which was deposited in her bank account in July 2020, the Fed said. She then made two $7,400 withdrawals on consecutive days so the amount wouldn’t trigger a currency transaction report, according to the central bank.
Another Miami-based banker, Manuel Pinazo, a former client associate at Merrill Lynch, a Bank of America subsidiary, obtained a $20,000 EIDL in August 2020, the regulator said.
Michael Lemley, a former branch manager for Regions in Keller, Texas, received a $12,500 EIDL in July 2020, the Fed said.
Dedryck Carson, a Birmingham, Alabama-based former financial relationship specialist for Regions, obtained a $10,000 EIDL grant in July 2020, the central bank said.
Autumn Jordan, a Jacksonville, Florida-based client service representative for Merrill Lynch, received the smallest sum among the banned bankers — a $9,000 advance from the SBA in July 2020, the Fed said.
The banned bankers neither admitted nor denied the conduct, the regulator said. And each agreed not to participate in future banking activity or risk criminal or civil penalties.
However, Jordan, told Bloomberg the alleged actions were done "fraudulently in my name." The other bankers did not respond to the wire service's requests for comment or could not be reached.
The U.S. government's COVID-19 Fraud Enforcement Task Force, which includes the Fed, has handed down 1,000 criminal charges, as of March, and opened 200 civil cases against 1,800 people and encompassing billions of dollars in suspected fraud, a White House fact sheet indicated.
A Regions spokesperson, when reached by Bloomberg, said the activities the central bank alleges go against the bank’s policies. A Bank of America representative declined to comment to the wire service.
