Fed Inspector General Reports Data Breach by Former Staffer

The Office of Inspector General for the Federal Reserve reported that a former staff member in the Division of International Finance repeatedly attempted to remove confidential information prior to retiring in July 2024. The employee triggered security alerts in 2021 and 2023 for copying Federal Open Market Committee files to unencrypted USB drives and emailing sensitive data to personal addresses.

Additional alerts occurred just before the employee's retirement, involving the unauthorized printing and transferring of sensitive files. These actions coincided with a June 2024 trip to a restricted country. Despite these warnings, internal investigators did not issue a formal misconduct finding, citing a lack of clear records on what information was removed and the classification of many alerts as false positives.

The Inspector General described the incident as a failure of collective action across multiple divisions, noting that follow-up activities were not commensurate with the risks. The Board of Governors concurred with recommendations to immediately improve the exit process for employees who have access to confidential policymaking information.