The story published by the Wall Street Journal regarding the report on U.S banks' living wills is now being investigated by the Federal Reserve and the Federal Deposit Insurance Corporation. The story was published before regulators officially announced the reports.
Eric Kollig, the Fed spokesperson, already asked its inspector general, its internal watchdog, to investigate on how the media outlet was able to gather the said report. The media entity reported that several US banks will receive harsh verdicts regarding the process on how they will handle bankruptcy issues as per Reuters.
As reported by the Wall Street Journal, Republican Senator Bob Corker of Tennessee, who is also a member of the Senate Banking Committee, said that he finds it very disconcerting that the reports have been leaked to the media which ultimately undermine its credibility.
The media entity's story hit Twitter and its home page hours before the regulators posted the official reports on their webpage which is also synchronized to the financial markets' preparation for banks to release their quarterly earnings.
As reported by Bloomberg, Gerard Baker, Wall Street Journal's editor in chief, said they are very disappointed to learn that the federal government is launching an investigation in order to determine the personalities that are behind the leaked report. Baker added that the story they made was the work of dedicated reporting with regards to public interest. Baker reiterated that these types of investigation will only intimidate them and other media outlets in bringing light to certain issues that mainly affect the lives of Americans and the livelihood of American citizens.
Reports have been sent out this week regarding the failing grades of five banks over their contingency plan on bankruptcy. This could start a long regulatory chain that could end up breaking the banks and the economy as well.
