SEC launched extensive probe to identify sources in Reuters stories

Thu Jul 31, 2014 8:33pm EDT
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By Paritosh Bansal and Jason Lange

NEW YORK/WASHINGTON (Reuters) - A U.S. Securities and Exchange Commission watchdog conducted an extensive, months-long investigation to find out who had leaked information that appeared in two Reuters stories published last autumn, but it was unable to identify the sources, according to a report of the probe seen by Reuters on Thursday.

The SEC's Office of Inspector General (OIG) started the investigation after Reuters published information about the regulator's decision, taken in a closed-door meeting on September 12, 2013, to settle its probe into JPMorgan Chase & Co’s massive London Whale trading loss.

The investigation started after Reuters reported on Sept. 17, 2013 that the regulator had approved its portion of a $700 million civil settlement with JPMorgan in a split vote. The story also said that two of the five commissioners had recused themselves from the decision.

The SEC made its decision public on Sept. 19, 2013. About a week later, Reuters reported further non-public details about why one of the commissioners, Michael Piwowar, had voted against the settlement.

In its report, dated March 5, the watchdog said it interviewed as many as 53 SEC employees, including Chair Mary Jo White, SEC commissioners and other top officials, during the investigation.

An OIG official said its inspectors don’t consider issues of press freedom when carrying out their investigations, and that the probe was launched at White's request. "Our office doesn't really differentiate where the information went," said Raphael Kozolchyk, the watchdog’s legislative and public affairs counsel.

The SEC declined to comment on the OIG's probe and report. CNBC earlier reported on its contents.  

Piwowar raised concerns about the leaked information with White, according to the OIG report. White and Piwowar could not immediately be reached for comment.   Continued...

The Thomson Reuters logo is seen on the company building in Times Square, New York October 29, 2013. REUTERS/Carlo Allegri