By Patrick A. Heller
Commentary on Precious Metals Prepared for CoinWeek.com
In 2007 and again in 2009, the Gold Anti-Trust Action Committee (GATA), whose website is http://www.gata.org, filed Freedom of Information Act requests with the US Treasury and Federal Reserve seeking documents related to gold swaps going back to 1990.
In response, a modest quantity of largely irrelevant documents were turned over, some heavily redacted, along with statements that neither agency had any other documents that fell within the disclosure rules of the FOIA requests. These blanket denials were quickly proved untrue as the Federal Reserve did not even turn over a copy of a document posted on its own public website. The requests also resulted in a member of the Federal Reserve Board writing a letter defending the lack of disclosure because the Federal Reserve System had gold swap arrangements with foreign banks which were exempt from disclosure. Before the release of this letter, the official Federal Reserve System response was that it did not have gold swap arrangements.
The Freedom Of Information Act exempts the government from turning over documents for a variety of reasons. With a strong suspicion that the Federal Reserve was erroneously claiming exemption from disclosure on many documents, GATA filed suit against the Federal Reserve. The judge required the Federal Reserve to provide her with ten documents where the Fed claimed an exemption from disclosure. After reading them, the judge ordered that the Fed release one to GATA and for it to reimburse GATA for legal costs.
The released document contained the minutes of a 1997 meeting where Federal Reserve officials met with their counterparts from other nations to coordinate their gold swap policies.
The Commodity Futures Trading Commission (CFTC) is still not finished with its now four-year investigation into possible manipulation of the silver market. With that sign of government inaction on suppression of gold and silver prices, GATA has pushed forward again. On July 24 and 25, it filed a new round of FOIA document requests with the US State Department, US Treasury Department, Federal Reserve Board and the Federal Open Market Committee.
The nature of the requests has expanded to cover any documents involving gold, again from 1990 to date. In the documents filed with the US Treasury, the request specifically stated that it encompassed all of the records of the Treasury’s sub-agencies (e.g. the Exchange Stabilization Fund). In the previous request, the Treasury may have withheld many documents using the subterfuge that GATA had not specifically asked for documents from named sub-agencies.
These requests come in the wake of public furor over the extent of market manipulations beyond the recently unveiled scandal of manipulated LIBOR interest rates. In my judgment, GATA’s timing is opportune, taking advantage of growing distrust of politicians, bureaucrats, and the government in general. Expect the results to take some time. But, when the course of these FOIA requests is finished, I anticipate the release of thousands of pages of documents showing that the government lied to the public, to the detriment of Americans.
If and when this comes to pass, I would not want to be one of the public servants who inflicted such harm onto the people.
To read the new FOIA requests, go to:
Patrick A. Heller owns Liberty Coin Service and Premier Coins & Collectibles in Lansing, Michigan and writes Liberty’s Outlook, a monthly newsletter on rare coins and precious metals subjects. Past newsletter issues can be viewed at http://www.libertycoinservice.com. Other commentaries are available at Numismaster (http://www.numismaster.com under “News & Articles). His award-winning radio show “Things You ‘Know’ That Just Aren’t So, And Important News You Need To Know” can be heard at 8:45 AM Wednesday and Friday mornings on 1320-AM WILS in Lansing (which streams live and becomes part of the audio and text archives posted at http://www.1320wils.com.