Fed Requests Probe to Find Source of Leak: Justice Asks FBI Aid In Interest Rate Case
The FBI has been called in to help the Federal Reserve investigate the source of a leak that eight of 12 Fed banks have recommended an increase in a key interest rate, according to sources familiar with the inquiry.</br></br>The Fed late last week asked the Justice Department for help in finding the origin of the leak, sources said, and the FBI was assigned to the task. The decision to pursue an investigation with the help of the Justice Department was an indication of how seriously top Fed officials viewed the leak.</br></br>The request to involve the FBI also appears to confirm the accuracy of the leak, which came in the form of a Reuter news service report. The story caused bond prices to fall and interest rates to jump as analysts and investors concluded that Fed policymakers were more likely than the analysts and investors had thought to raise short-term rates.</br></br>Fed spokesman Joseph R. Coyne declined to comment on any aspect of an investigation or even to confirm such an inquiry was in progress.</br></br>Someone privy to such inside information as the requests to raise rates could use it to make investments that might rise in value when it became public or after the Fed had acted. Alternatively, a number of analysts said, a Fed official might have provided the facts to a reporter in hopes of affecting the outcome of tomorrowÛªs meeting of the central bank's top policymaking group, the Federal Open Market Committee.