WASHINGTON — The Federal Deposit Insurance Corp.'s inspector general is looking into the early, apparently unauthorized release of the proposal to implement the Volcker Rule, which would restrict the ability of banks to engage in proprietary trading.
Republican Sen. Richard Shelby revealed the existence of an inquiry on Tuesday, but he did not specify which agency was looking into the matter. The FDIC's office of inspector general later confirmed its involvement.
During a Senate Banking Committee hearing, Shelby argued that banking regulators have struggled to effectively implement several key rules required by the Dodd-Frank Act.
"Most importantly, the proposal to implement the Volcker rule has been marred by misconduct, ambiguity, and interagency discord," Shelby said. "Drafts of the proposed rule were leaked to the press, prompting Inspectors General inquiries into whether agency personnel violated confidentiality rules."
Fred Gibson, the FDIC's deputy inspector general, said that his office is conducting a review to determine if any FDIC employees were involved in leaking details of the proposed rule.
"We are conducting a review of the early release of information regarding the Volcker Rule, but we have not yet completed our report to management or provided them with any information," Gibson said.
He could not say whether other IGs are conducting similar investigations. A spokesman for the Treasury IG said the office does not confirm or deny any ongoing investigations.
Gibson said the review is not an investigation, which would imply potential criminal conduct. The review covers the early release of several leaked drafts of excerpts of the proposal, as well as the leak of the final proposed rule, which was obtained and published by American Banker on Oct. 6, six days before it was released by regulators.