Fed Watchdog Flags Apparent Data Breach by Retiring Staff Member

A former staff member at the US Federal Reserve was found to have repeatedly attempted to remove confidential information from the central bank before retiring in July 2024, according to a report by the Fed's Inspector General.

The IG said that despite the potential severity of the incident, its internal investigators did not find sufficient evidence to pursue a formal misconduct investigation. This was because available records did not provide clear indication of what information had been removed and many alerts involving the information were false positives.

The report highlighted systemic concerns about how the Fed manages the exit process of employees with access to confidential policymaking information. The IG said that the Fed concurred with recommendations to improve data management policies and is taking steps to better communicate these policies to exiting employees.