Federal prosecutors filed fraud charges yesterday against a former Federal Reserve Board aide who gained access to the board's computer files of sensitive financial data using another computer in a major brokerage firm, according to sources close to the investigation.
The employe, Theode C. Langevin, 34, of Laurel, was accused of one count of wire fraud for attempting to penetrate the files on Nov. 22, the day he went to work for E.F. Hutton & Co., a Wall Street securities firm, according to an information filed in U.S. District Court yesterday.
Authorized employes are able to tie into the Fed's computer files using a numerical code that is transmitted by telephone. When employes leave the Fed, their code numbers are canceled. Sources familiar with the investigation say that Langevin, using another Fed employe's name and access code, got into the Fed computer system on at least one occasion.
Prosecutors file an information in lieu of an indictment when they expect defendants to plead guilty. Reached by phone at his home, Langevin said he intends to plead guilty to the charge, but said he did not know if a court hearing date had been set for the plea. He faces up to five years in prison and a $1,000 fine on the one charge.
Thomas Rae, general counsel at E.F. Hutton, said yesterday that Langevin, who began work there on Nov. 22 as a "Fed watcher," was asked to resign 10 days later when federal officials notified the company of the investigation.
Rae said he did not know if Langevin, whose job was to follow Federal Reserve actions and advise the company on possible moves by the board, successfully tapped into the board's computer. But he said Langevin did not pass any such information on to the company and that the company "was not the recipient of any reports from Mr. Langevin."
According to the charge filed by prosecutors, Langevin attempted to gain access by telephone to the board's computer data files of information on the changes of the nation's money supply--a key factor in determining Fed actions. Rae said information of that nature would be "extremely valuable" to investors and brokers who follow the Fed's credit policies, which are important in predicting interest rates and securities prices.
The court filing does not say whether Langevin--who was earning $35,000 a year at the Fed and $60,000 a year at the brokerage firm--secured the secret information.
Sources said yesterday that the first unauthorized entry, made on the day Langevin began work at E.F. Hutton, was discovered within days by a Fed supervisor, who reviewed information regarding who was using the computer files and discovered that the employe whose name was used was on leave that day.
After that, the Fed used computer-blocking mechanisms to thwart further attempts and traced the attempts to Langevin at E.F. Hutton, sources said.
Langevin's last attempt to gain entry into the files was Nov. 29, a week after the first entry was made, according to prosecutors.
Langevin declined to comment on the case or on an assertion made by prosecutors in court papers that he made plans to tap into the computer 10 days before he left the Fed. "I'm trying to put everything back together," he said, adding that, "In hindsight, it was totally unnecessary for me to do this, and it was a very unfortunate thing. This is an excruciating experience."
Langevin also said he did not pass any of the information he gathered to E.F. Hutton. A spokesman for the Fed said he could not comment on the incident except to say that Langevin, who worked there for six years, had a good work record.