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BtrARD trF EOVERNORE

OF THE
F E D E F I A LR E S E R V Es Y S T E M
, . l. eO55l
WAStrlNGrENC

KEV]N M. WARSH
MEMBEF DF THE BOARtr

September 17, 2009

Mr. William J. Olson

William J. Olson,P.C.
370 Maple Avenue rvVest
Suite4
Vienna,V A 22180-5615

Dear Mr. Olson:

This is in responseto your letter datedand receivedby the Board's

Freedomof Information office on August 20, 2009,in which you appeal,on behalf
of the Gold Anti-Trust Action Cornrnittee("GATA"), pursuantto l-z CFR
261.13(i),the determinationof the Secretaryof the Board ("Secretary',)on your
requestunderthe Freedomof Information Act ("the Act" or "FOIA,'),
5 U.S.C.$ 552. By letterdatedApril 14,2009,you requesteddocumentsfrom
JanuaryI, 1990,to the dateof your letter,"relating to, explaining,denyingor
otherwisementioning:'gold swap'; 'gold swaps';'gold swapped';,proposedgold
swap'; 'proposedgold swaps';or 'proposedgold swapped',eitherinvolvingthe
United Statesof America, or any department,agencyor agent thereof o. oot
involving the United Statesof America." Your requestalso includeseighteen
other categoriesof documents,generallyrelatingto gold swaps,including
numerousdocumentsfrom the Departmentof the Treasury("Treasury") as well as
docutnentsrelating.toyour near-identicalFOIA requestregardinggoid r*ups from
December6^2007.1

'
Among other things, the eighteenother categoriesof docurnentsrequested
include"all recordsof FOIA requestssubminedby otherpersonswhich requested
recordsinvolving:(a) the GATA FOIA requestof December6, 20A7or (b) the
recordsprovidedto GATA in responseto its FOIA requestof December6, 2OO7
sinseDecember6,2007." Your requestalsoseekscopiesof all FOIA requests
madeby personsor entitiesotherthan GATA for recordsrelating to "gold swap,"
"gold swaps,"or "gold swapped"sinceJanuary1, 1990. The Secretaryinformed
you that the Board has not receivedany FOIA requestsfor recordsrequestedby
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Staffs searchdiscloseddocumentsthat were responsivero your

request.By letter datedAugust 5,2009, the Secretaryinformed you that staff had
seatchedBoard recordsand made suitableinquiriesand found t'wo additional
documents,in addition to thosethat were responsiveto your December 6,2007
FOIA request. Thesetwo documents,consistingof 173pages,were providedto
you in their entirety. The Secretaryinformed you that all other responsive
documentscontainedinformation that was exernptfrom disclosure'under
exemptions4 and 5 of FOIA, 5 U.S.C.gg 552(b)(a)and (b)(5),respecrively.The
Secretaryfurther informed you that the documentscontaining the exempt
informationhad beenreviewedin accordancewith subsection(b) of FOIA andthat
Iro reasonablysegregablenonexemptinformationwas found. Accordingly,I3T
full pageswere withheld from you, in like fashionto your earlier request.

You appealedthis determinationby letter datedand receivedby the

Board's Freedomof Information office on August20,2009. I interpretyour
appealas (l) requestingthe Board to reevaluatethe Secretary'sdeterminationthat
the claimedexemptionsprovide valid basesfor withholding the information,
(2) challengingBoard staff s searchin responseto your request,(3) requesringthat
the Board provide documentsoriginating from Treasury,(4) requesringthat the
Board makea discretionaryreleaseof infonnation evenif the Board determinesthe
documentsare coveredby an exerrption,and (5) requestingthe Board to provide a
Vauelm index of the withheld information.

Information in the possessionof an agencyis exemptfrom disclosure

if it falls within one or more of the enumeratedFOIA exemprionl. Sgg5 U.S.C.
$$ 552(b)(l)-(9). Exemption4 pennitsagenciesto withhold "tradesecretsand
commercialor financial information obtainedfrom a personand privileged or
confidential-"5 U.S.C.$ 552(bX4), Informationis exemptfrorndisclosureif
disclosureis likely either to impair the government'sability to obtain necessary
information in the future or to causesubstantialharm to the competitivepositionof
the personfrom whom the information was obtained. SeeNational par.ksand
conservatiqnAss'n v. Morton,498F.2d765,770(D.c. cir. lg74).

GATA or provided to GATA. The Board also hasnot receivedany subsequent

requestsfor recordspertainingto the topics listed in your request. Accordingly,
the Secretaryinformed you that the Board doesrrot have any recordsresponsiveto
this portion of your request. I have confrmed the Secretary'sdetermination
regardingthe lack of any subsequentrequestfor recordsregardinggold swaps
sinceDecember2007-
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In connectionwith your appeal,I have confirmedthat the information

withheld under exemption4 consistsof confidentialcortmercial or financial
informationrelating to the operationsof the FederalReserveBanks that was
obtainedwithin the meaningof exemption4. This includesinformation relatingto
swap arrangelnentswith foreign bankson behalf of the FederalReserveSystem
and is not the type of information that is customarilydisclosedto the public. This
informationwas properly withheld from you.

Exemption 5 of FOIA permitsagenciesto withhold "inter-agencyor

intra-agencymemorandumsor letterswhich would not be availableby law toa
party otherthan an agencyin litigation with the agencyj' s u.s.C. g 3szpy1s1.
This exemptionincludesdocumentsthat embodythe ';deliberativeprocess"of the
agencybefore reaching a decision, in order to encouragehonestani frank
communicationwithin the agency. See,e€., National Wildlife Fed'n v. U.nited
Statesf,orestServ.,861 F,2d 1 14,ll8-20 (9th Cir. 1988). Exemprion5, tho"fore,
covers"recommendations,draft documents,proposals,suggestions,and other
subjectivedocumentswhich reflect the personalopinionsof the writer ratherthan
the policy of the agency." of t
617F.2d854,866(D-C.Cir. 1980)."[E]venfactualsegments of documents are
protectedby Exemption5 from disclosureif the mannerof selectingor presenting
thosefactswould revealthe deliberat[ive]process,or if the facts*" 'inixt icablv
intertwined' with the policy making process." Jo
729F- Supp-871,877 (D.D.C. 1989). "Exemption5 servesa numbe.of purpor"t
amongwhich [is] the preventionof prematuredisclosureof proposedpolicies
beforethey have beenfinally formulatedor adopted." Wolfl v. Departmentof
HealthandHurnanserv.,839 F.2d 768,775(D.c.cir. lggs).

I have confirmed that information withheld frorn you under

exemption5 in this caseis both predecisionaland deliberativewithin fie meaning
of exemption5. Accordingly, this informationwas properly withheld.

As previously noted,the Secretaryprovidedyou with 173pagesof

documentsresponsiveto your request. You statethat thesedocumentsappearto
be redacted.I have confirmedthat thesedocumentswere provided to you as they
were found in our files, without having beenredactedby Board staff. These
documentsconsistof notes for and meetingtranscriptsof the FederalOpenMarket
Committee("FOMC") and originatedfrom individualsacting in their capacityas
FOMC staff, not Board staff. The FOMC is a separateentity for FOIA purpor.t
with its own systemsof recordsand FOIA regulation. Any redactionswere made
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by FOMC staff, and Board FOIA staff receivedthe documentsin redactedfonn.

Therefore,YoDmay wish to contactthe FOMC directly at the addressbelow should
you wish to requestthe unredactedportionsof thesedocuments.

FederalOpenMarket Committee
Carol R. Low
SecretariatAssistant
20th streetand constitutionAvenue,N.w., Mail Stop 55
Washington,D.C. 20551

With regardto thesesame173pagesof documents,you also statethat

ttreywere responsiveto, but not produced,in responseto an earlierFOIA request
from GATA. You statethat "this is evidenceof the FRB's failure to adequaGly
searchand/ordiscloseresponsivedocuments...." You also cite to a Board staif
discussionpapermentioninggold swapsthat you found on the internetvia a
Google search,and which was not disclosedin responseto your initial request,as
further evidenceof the inadequacyof the initial search-2Failure to conductan
adequateand proper searchto locateresponsiverecordswould provide a basisfor
an appeal,ild your appealquestionsthe adeqr.racy and propriety of Board staffs
initial search.

The Board's Rules RegardingAvailability of Information requirestaff

to conduct, in responseto an initial requestunder FOIA, an appropriateand
reasonablesearch,by manualor automatedneans, of the Board'sofficial files and
any other files containingBoard recordsin existenceon the dateof receiptof the
requestas seemreasonablylikely in the particularcircumstancesto contain
informationof the kind requested.12 c.F.R. g 261,2(n)(1);l2 c.F.R. g 261.13(0.
Under FOIA, the Board is not requiredto provide copiesof documentsthat are
alreadyin the public domain, suchas on a website,and are reasonablyaccessible
to the requester.5 u.s.c. $ 552(a)(2)-(3).In this instance,the Boardstaff
discussionpaperwas posteddirectlyto the Board'spublic website.3In any case,
the disclosureof additionalresponsivedocumentswould not underminethe
reasonableness of staff s initial search.See,e.q.,Meeropolv. Meese,7g0 F .Zd
942,952-953(D.C. Cir. 1986).

2
Brahima Coulibaly, "Effects of FinancialAutarky and Integration:The Caseof
the SouthAfrica Embargo,"Board of Governorsof the FederalReserveSystem.
InternationalFinanceDiscussionPapers,No. 839, sept. 2005.
t httpt
// www.federalreserve.gov/pubs/i fdp/ z00sls 39/i fdp g39.htrn
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The Secretaryalso informedyou that you "may wish to contact

Treasurydirectly for assistancewith your requestfor recordsthat originatedwith
or are locatedon the Treasurywebsite." You mistakenlyassertin your appealthat
this statement"acknowledgesthat (the Board) has copiesof records.that
originatedwith or are locatedon the Treasurywebsite."' In fact, staffs searchof
Board recordsdid not locate any suchdocuments,and the Secretary'sstatement
was simply to inform you of the correctagencyto which you shouid direct that
poftion of your request. Accordingly, any queriesrelating to this portion of your
requestshouldbe directedto Treasuryfor any documentsin the possessionof that
agency.

With respectto your requestfor a descriptiveindex of the withheld

information,it is well settledthat a FOIA requesteriJ not entitledto receivea
VauglurIndex during the administrativeprocess.See.e.g.,Schwgrzv. United
StatesDep't of Treasurv,131F. Supp.2d,r4z,l47 @.D,c. 2000),erg"k". u,
cIA, No. 83-1426,slip op, At 3 (D.D.c. September28, t9g4). Ac.ordirrgb,,th"
Board is under no obligation to provide you with a Vauqhn Irrdex,and I declineto
do so in connectionwith this appeal.

Basedon a de ngvo review of the Secretary'sdecision,and on the

recommendationof counseiregardingthe legal issuesinvolved, I affirm the
Secretary'sdecisionto withhold information from you under exemptions4 and 5
of FOIA for the reasonsstatedabove. Moreover,in light of the natureof the
withheld information,it would not be appropriateto make a discretionarTrelease
of suchinformation. Accordingly, your appealis denied. If you believethat the
Board is withholding information from you contrary to your legal rights, you may
seekjudicial review of my decisionin an appropriateUnited Statesbistrict Court
pursuantto 5 U.S.C. g 552(a)(4XB).

Sincerely,

K,rruL

T O T A LP . A s