The Mirror

Did The Senate Select Committee On Investigations Just Hire A Leaker?

A Securities and Exchange Commission lawyer and former staffer to Sen. Carl Levin (D-Mich.) recently left his SEC post after a year — sources say he’s told friends that he was forced out and some suspect he is the infamous SEC leaker who gave information about an executive session to Reuters.

But get this — he was soon rehired to be on Levin’s Permanent Select Subcommittee on Investigations, which is reportedly known for its “high profile investigative work.” Reporters get out your pens. Nothing to leak there, right?

He started his new position on Capitol Hill today.

According to The Mirror‘s sources, the office of the SEC commissioner who hired SEC lawyer Tyler Gellasch is denying that he was pushed out. What’s more, his boss, SEC Democratic member Kara Stein, also a former Senate staffer, is publicly wishing him well and calling him a “tremendous asset” to her office.

But a BusinessWeek story published last week indicates that he was confronted by SEC Chair Mary Jo White for leaking.

“[Kara] Stein began her SEC tenure quietly. She assembled a staff that included Tyler Gellasch, a Democratic policy aide to Senator Carl Levin of Michigan, whose committee investigated Goldman Sachs Group Inc. (GS:US)’s role in the mortgage crisis and JPMorgan Chase & Co. (JPM:US)’s $6.2 billion trading loss. She didn’t give a speech or sit for interviews for three months.”

Before final action, some of Stein’s views showed up in media reports, which said that she and Gary Gensler, the chairman of the Commodity Futures Trading Commission, were insisting on adding restrictions to the rule. The reports angered White, whose chief of staff, Lona Nallengara, confronted Gellasch, saying that Stein’s coordination with outside regulators such as Gensler could undermine SEC negotiations, a person familiar with the matter said.”

On July 31, CNBC reported that the SEC was trying to find the leaker on the JP Morgan “London Whale” settlement after an executive session was leaked to ReutersSarah Lynch, but could not.

The investigation was serious — they thoroughly searched BlackBerry and phone records. They interviewed 53 employees. The report concluded that a few commissioners and staff spoke to Lynch. Sources tell The Mirror that Gellasch admitted that he spoke to her. He denies, however, being the leaker. A story by Eamon Javers reports the following:

“The wide-ranging hunt for the apparent leaker went all the way to the top: The inspector general’s report says investigators interviewed SEC Chairwoman Mary Jo White, the SEC commissioners, five employees of the Office of the Chair and 18 employees of the Offices of the Commissioners. In their report, investigators said they searched the emails and BlackBerry records of 39 SEC employees and conducted interviews with 53 SEC employees in total. Details in this article are drawn from the inspector general’s report.”

A former Financial Services Committee aide familiar with the matter remarked to The Mirror,”Shouldn’t the PSI committee and the chairman and staff find out if this staffer was leaking sensitive information before hiring him? There’s a lot of evidence that points to it. How ironic that this committee is hiring such a potentially reckless person.”

The Mirror phoned the Select Subcommittee to request comment on the matter. None was forthcoming by press time.