A former Federal Reserve supervisor is facing up to 25 years of jail time after pleading guilty to
Robert Brian Thompson, a longtime bank examiner and manager within the Fed's large bank supervisory group, was charged by federal prosecutors with using nonpublic and confidential supervisory information about banks to make stock trades.
According to a press release from the Department of Justice, Thompson executed 69 transactions related to publicly traded financial institutions between October 2020 and February 2024. These trades resulted in $771,678 of profit.
Thompson lied about this activity to the Richmond Fed, stating that he held no such assets on his official annual disclosure report, according to the DOJ.
Thompson could not immediately be reached for comment.
As the deputy central point of contact for the Large & Foreign Banking Organizations, Thompson oversaw 18 of the biggest banks that fall short of being global systemically important. In this role, he frequently received and reviewed information about banks' financial performances before they were released to the public. He also was privy to supervisory information, which is the legal property of the Fed.
While based in Richmond, he also reported to the supervisory division within the Federal Reserve Board of Governors.
According to federal investigators, Thompson's illegal trades included buying Capital One Financial stock after getting an early look at a strong quarterly earnings report in 2021. He also purchased out-of-the-money put option contracts — a wager that share prices will fall — on New York Community Bancorp after learning about losses related to the bank's acquisition of Signature Bank.
Thompson faces up to 20 years in jail after pleading guilty to the insider trading charge and another five years for making false statements. His sentencing hearing is set for March 19.
The 43-year-old Mosely, Virginia, resident's actions are also being investigated by the Securities and Exchange Commission, which filed a lawsuit against him earlier this month. On Tuesday, the agency reported that it entered into a consent agreement with Thompson that will result in a disgorgement penalty and civil fine to be determined by a judge.
The Federal Reserve's Office of the Inspector General is also looking into the matter.
