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Fed Inspector General Reopens Leak Investigation
The move comes as Senate Finance Committee Chairman Sen. Orrin Hatch demands more information about how a private newsletter obtained confidential details of Fed discussions 
 
The Federal Reserve Board’s inspector general has reopened an investigation into a two-year-old leak of confidential monetary information amid rising Congressional scrutiny into how the Fed has handled the matter, ProPublica has learned. 
 
Sources told ProPublica that the IG’s action came March 4 and was based on new information. Investigators had closed the leak inquiry last December after initiating it in March 2013.
 
Congressional attention to the leak has grown in recent weeks. On Wednesday, Senate Finance Committee Chairman Orrin Hatch, R-Utah, joined those demanding more details about how the leak investigation was handled. 
 
Hatch sent strongly worded letters to Fed Chairwoman Janet Yellen and to the board’s inspector general, Mark Bialek, expressing frustration over the fact that the original investigation and its results had remained private. He also complained that Bialek’s staff had been reluctant meet on the subject.
 
“Of course, that’s unacceptable,’’ Hatch said in the letter to Bialek, accusing his office of trying to “cloak information” by contending the investigation was a confidential “pre-decisional” matter of the Federal Open Market Committee (FOMC), which sets monetary policy that guides the economy. 
 
ProPublica reported earlier on the October 2012 leak, in which confidential information about key moves in the Fed’s bond-buying program found its way into a financial analyst’s newsletter. The information went to the analyst’s clients one day before the scheduled public release of the open market committee’s meeting minutes.
 
The newsletter revealed some of what the minutes would say as well as fresh details about the Fed’s internal plans and deliberations – information that could have provided traders with an edge. 
 
Spokesmen for Bialek’s office and the Fed acknowledged receiving the letters from Hatch but declined to comment on them. 
 
Fed protocol requires that in the event of a leak, the FOMC secretary and the Fed general counsel are to perform a preliminary review. Results are to be reported to the Fed chairman. The general counsel then decides if the matter warrants further investigation by the Fed’s inspector general.
 
After becoming aware of the leak, then-Chairman Ben Bernanke instructed Scott Alvarez, the Fed’s general counsel, and William English, the committee’s secretary, to conduct an internal inquiry. They sent a questionnaire to people who had access to the information that was disclosed. 
 
Hatch’s letter to the IG asks for a briefing on the investigation, who at the Fed was interviewed, whether the IG gathered phone or email records to look for contacts with the newsletter analyst and why there has been no report about it. 
 
“There is no record on the OIG’s public website to indicate that any investigation occurred, or of any attendant audit or audit report, or results of any investigation that may have occurred,” Hatch wrote.
 
The Fed never revealed the inquiry and only publicly acknowledged the leak in response to a public records request by ProPublica. 
 
In the letter to Yellen, Hatch wrote: “It does not appear that the Board has publicly disclosed any of its findings from its investigation into the potential severe breach of information security in this matter.”
 
Hatch’s interest adds a more bipartisan cast to concerns on Capitol Hill about the leak. 
 
Sen. Elizabeth Warren, D-Mass., and Rep. Elijah Cummings, D-Md., have also asked the Fed for more information about the leak. At a recent hearing on monetary policy, Warren sharply questioned Yellen about whether the Fed would provide a briefing. Yellen promised it would.
 
Courtesy: ProPublica.org

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SEBI bars Anmol India from raising funds from investors

Anmol India Agro-Herbal and its directors have been barred by SEBI from disposing of or alienate any of the properties or assets owned or acquired through the money raised 

 

Market regulator Securities and Exchange Board of India (SEBI) barred Anmol India Agro-Herbal Farming & Dairies Care Co Ltd from raising funds from the public with immediate effect. 
 
Besides, it directed the company not to launch any new scheme in the garb of plant cultivation and animal rearing. SEBI also asked the company and its directors--Mohammad Junaid Memon, Mohammad Umar Memon, Mohammad Javed Memon and Mohammad Khalid Memon --"not to collect any fresh money from investors under its existing schemes" as well as "not to launch any new scheme.
 
SEBI found that Anmol India was running 'collective investment schemes (CIS)' without obtaining registration from the regulator.
 
The company was inviting investments from the general public through its 'development and maintenance, rearing of the farms, animals and plants' scheme.
 
"... 'scheme' of sale, development and maintenance, rearing of farms,  animals, plants' offered by Anmol Agro with an intended promise of returns," when considered in light of peculiar characteristics and features of such scheme prima facie satisfies all the conditions under CIS, SEBI said.
 
They also have "to immediately submit the full inventory of the assets including land obtained through money raised".
 
Besides, the company and its directors have been barred from disposing of or alienate any of the properties or assets owned or acquired through the money raised.
 
Further, they cannot divert any funds raised from public at large which are kept in bank account of the company. They have to furnish all details of its investors, among other information, to SEBI.
 
These directions would take effect “immediately and shall be in force until further orders”.
 

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COMMENTS

integrity

2 years ago

Was their crime graver than Sahara's . Saharas are probably not barred from launching new schemes. Only two up based activist seem to be fighting against alleged fraudulent practices by Sahara Q ?

The Buffet of Canada warns against tech-bubble
Prem Watsa, Chairman of Fairfax Financial Holdings Ltd., warns against the “bubble” of tech companies with huge valuations; predicts it will end “very badly”
 
Often referred to as the “Warren Buffet of Canada”, Prem Watsa, in the annual letter to shareholders issued by his holding company Fairfax Financial Holdings Ltd, has warned against the “bubble” of tech firms – confident that the speculation will end “very badly”. His stance is consistent with his statements from previous years. In the company's annual meeting last year, he had stated that the tech rally would, “end in tears”, just like it did for the “dot-com era.” 
 
In the letter to shareholders, he substantiates his stance by pointing that the huge valuations of several tech companies like Twitter, Netflix and Facebook are a result of heavy speculation. He cites Uber as an example, whose valuation at $41.2 billion is 14.7 times the $2.8 billion cumulative equity capital it raised. A similar pattern can be observed in many of the big tech firms – including Snapchat and Xioami. Watsa observes that speculation is rampant in both public and private tech firms.
 
 
 
The letter also refers to a piece of data from Wall Street Journal, according to which  there are 73 companies that are valued at more than $1 billion by venture capital investors, versus half that number prior to the dot.com crash. His prediction for these companies also mirrors the fate of the dot-coms, which was spectacularly dismal.
 
However, he still defends the company's decision to remain a key shareholder of Blackberry. “I have learned that the tech world is very difficult to predict and things change very quickly. Yesterday’s hit can be today’s dog, but with the right leadership, things can also change very quickly for the positive. We continue to be excited to be long term shareholders of BlackBerry and have no intention of supporting a takeover of BlackBerry.” 

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