A former Goldman Sachs (GS) employee will never work in banking again, after pleading guilty to charges of stealing confidential information from the Federal Reserve Bank of New York.
On Thursday, the Fed permanently barred Rohit Bansal, who was able to obtain confidential information from the New York Fed because he was an employee of the New York Fed before going to work at Goldman Sachs, from working in banking as part of his guilty plea for misdemeanor theft of confidential information from the Federal Reserve.
According to the Fed, Bansal agreed to enter into a consent order with the Federal Reserve Board barring him from the banking industry and requiring him to cooperate in the Board's ongoing investigation.
Bansal’s actions already lead to New York Department of Financial Services fining Goldman Sachs $50 million.
According to the NYDFS, Bansal began working at Goldman Sachs in July 2014, as associate in the financial institutions group of the investment banking division.
Before joining Goldman, Bansal worked at the New York Fed for nearly seven years as a bank examiner. His last position at the Fed was as the “central point of contact” for an unnamed financial institution. As the central point of contact, Bansal was the financial institutions’ primary supervisory contact at the Fed.
According to the NYDFS, Bansal was required to resign from his position at the New York Fed for, among other reasons, taking his work Blackberry overseas without obtaining prior authorization to do so and for attempting to falsify records to make it look like he had obtained such authorization, and for engaging in unauthorized communications with the Federal Reserve Board.
Despite those issues, Bansal was hired by Goldman Sachs, “in large part for the regulatory experience and knowledge he had gained while working at the New York Fed,” the NYDFS said.
Despite being prohibited by the Fed from working with any financial institution he had supervisory authority over while at the Fed, Goldman Sachs placed Bansal in charge of working for a Goldman client that he was in charge of examining mere months earlier as a regulator.
While working at Goldman, Bansal then wrongfully obtained confidential information, including approximately 35 documents, on approximately 20 occasions, from a former co-worker at the New York Fed, the NYDFS said.
These documents included confidential regulatory or supervisory information, many of which marked as “internal,” “restricted,” or “confidential”, and belonged to the NYDFS, the New York Fed or the Federal Deposit Insurance Corporation.
According to the NYDFS, Bansal’s conduit for receiving information from the New York Fed was his former coworker, Jason Gross, who has since been terminated for this conduct.
On Wednesday, Gross also pled guilty to misdemeanor theft of confidential information of the Federal Reserve. As part of Gross's plea agreement, Gross is barred from participating in the affairs of any insured depository institution.
Goldman Sachs fired Bansal late last year after his malfeasance was discovered.
Despite Bansal being let go, Goldman will pay $50 million in fines for his actions.
Additionally, Goldman has accepted a three-year voluntary abstention from accepting new consulting engagements that require the NYDFS to authorize the disclosure of confidential information under New York banking laws, the NYDFS said.