Sep 26, 2014
An unprecedented look inside one of the most powerful, secretive institutions in the country. The NY Federal Reserve is supposed to monitor big banks. But when Carmen Segarra was hired, what she witnessed inside the Fed was so alarming that she got a tiny recorder and started secretly taping. ProPublica's print version.
Note: we released this episode early online, because we wanted it to be available when people heard the excerpt on Morning Edition.
- Ira introduces Carmen Segarra, a bank examiner for the Federal Reserve in New York who, in 2012, started secretly recording as she and her colleagues went about regulating one of the most powerful financial institutions in the country. This was during a time when the New York Fed was trying to become a stronger regulator, so that it wouldn't fail to miss another financial crisis like it did with the meltdown in 2008. As part of that effort to reform, the Fed had commissioned a highly confidential report, written by Columbia professor David Beim, that identified why the regulator failed in the years leading up to the crisis. Beim laid out specific recommendations for how the Fed could fix its problems. Carmen's recordings allow us to see if the Fed successfully heeded those recommendations more than two years later. What we hear is not reassuring.