BREAKING Questions About Leak at Federal Reserve Escalate to Insider-Trading Probe

It sure looks to me like "they" want to get Federal Reserve chair Janey Yellen.

WSJ is now reporting:

A high-profile investigation into a leak of sensitive information from the Federal Reserve in 2012 has escalated to an insider-trading probe led by a key market surveillance agency and federal prosecutors in Manhattan, according to people familiar with the matter.

The firm at the center of the probe, Medley Global Advisors put out a report, in advance of a Federal Reserve statement, with such specifics that were included in the statement that a reeks of a tip off from inside the Fed.

Here'e where things get interesting. Yellen has admitted that she met with Medley some time before the leak. Bloomberg reported in May:

Yellen also said that in June 2012 she met with an analyst from Medley Global Advisors, which published a report on deliberations of a September 2012 closed-door meeting of the Federal Open Market Committee, one day before minutes of the meeting were made public.

The Fed chair said she met with Medley analyst Regina Schleiger on June 11, 2012, “to hear her perspectives on international developments.”

In addition, the Fed chief noted that she could not have known about the September events reported in the Medley letter and added that she “did not convey any confidential information.”

Medley, an investment  advisory firm, is not co-operating with the investigation. It claims it is a news organization.

However, WSJ notes:

Traditional media firms are largely immune from insider-trading prosecution because even if they acquire private information, they publish it to a broad section of the public. But the government has no clear definition of what constitutes a media organization, in part because it is wary of being accused of infringing on the First Amendment.

Medley’s website refers to recipients of its research notes as “clients,” not readers or subscribers. It says the firm serves “the world’s top hedge funds, institutional investors, and asset managers” by delivering “unbiased intelligence on macroeconomic and political events by cultivating relationships with senior policy makers around the globe.”

  -RW