Skip to Navigation
Skip to Main content
OIG Home
OIG Home

In This Section

Skip SHARE THIS PAGE section Skip STAY CONNECTED section

April 1, 2022–September 30, 2022

Semiannual Report to Congress

available formats

Full Report:

PDF (3 MB)

Message From the Inspector General

Although it appears that the COVID-19 virus will be with us for some time, many of us have begun to take steps in both our personal and our professional lives to reconnect with others, rebuild our routines, and regain a sense of normalcy. As part of this transition, our office and both of the agencies we oversee are shifting to hybrid work.

The Board of Governors of the Federal Reserve System completed its return-to-office plan on June 3 and transitioned to a hybrid work schedule. The Consumer Financial Protection Bureau ended maximum telework by June and implemented optional full-time telework that will run through October 31. In separate evaluations, we assessed whether the Board and the CFPB implemented select workplace safety measures in response to the pandemic. We found that each agency’s enhanced cleaning, air filtration practices, social distancing measures, building access controls, and other actions were executed in accordance with their respective plans.

Our oversight of pandemic response efforts remains critically important. I continue to serve on the Pandemic Response Accountability Committee (PRAC) and am vice chair of the PRAC Investigations Subcommittee as well as a member of the PRAC Financial Sector Oversight Subcommittee. In addition, our Office of Audits and Evaluations and Office of Information Technology continue to assess the Board’s lending programs. Currently, we are evaluating the loan purchase and administration processes for the Main Street Lending Program (MSLP), vendor selection and management processes related to the Federal Reserve Bank of New York’s lending programs, and cybersecurity risk management for vendors supporting the MSLP and the Secondary Market Corporate Credit Facility.

Our Office of Investigations maintains a heavy caseload examining fraud related to the emergency lending programs established in response to the pandemic. In one recent case, for example, a Missouri business owner was charged in a 52-count indictment for a $27.1 million bank fraud scheme that included $12.4 million in forgivable Paycheck Protection Program (PPP) loans meant to help businesses weather the pandemic. In another, the owner of a Massachusetts information technology services company was sentenced to 39 months in prison and 3 years of supervised release for repeatedly filing loan applications using false tax documents and payroll processing records in an attempted $13 million PPP fraud; he received $2 million, nearly all of which the government has since recovered. In total, over the past 6 months, our investigative work related to pandemic fraud has resulted in 38 full investigations; 23 arrests; 18 convictions; and over $16.2 million in criminal fines, restitution, and special assessments.

Overall, our Office of Investigations closed 28 investigations and resolved 70 hotline complaints. Our work resulted in 17 referrals for criminal prosecution; 24 arrests; 14 indictments; 19 criminal informations; 28 convictions; and over $26 million in criminal fines, restitution, and special assessments.

During this reporting period, we examined whether the 2020 trading activities of certain senior Board and Federal Reserve Bank officials violated the law or Federal Reserve policies and whether the trading activities warranted further investigation by other authorities. With a cross-disciplinary OIG team, we conducted a comprehensive review of relevant records and found that the trading activities of the senior Board officials did not violate the laws, rules, regulations, or policies as investigated by our office; the investigation of senior Reserve Bank officials is ongoing.

In other work this reporting period, we completed annual audits of each agency, pursuant to the Federal Information Security Modernization Act of 2014, to determine the effectiveness of the agencies’ information security policies, procedures, and processes; we found that both agencies’ information security programs continue to operate effectively. We reviewed select information security controls for the Board’s Secure Document System, which provides for the secure distribution of Federal Open Market Committee documentation to authorized staff at the Board and the Reserve Banks, and found that overall, the security controls we tested were operating effectively. We also reviewed the software and license asset management processes of the Board’s Division of Research and Statistics and determined that the division has not established a software and license inventory and associated review procedures in accordance with agency policy. We conducted a risk assessment of the CFPB’s purchase card program and found that the risk of illegal, improper, or erroneous purchase card use is low. We assessed the CFPB’s preparedness to implement certain components of the Open, Public, Electronic, and Necessary Government Data Act of 2018, which requires federal agencies to create publicly available data inventories and outlines specific duties for federal chief data officers, and found that the agency is generally prepared to implement the act. Finally, we contracted with an independent public accounting firm to audit the CFPB’s compliance with the Payment Integrity Information Act of 2019 as it relates to the Civil Penalty Fund for fiscal year 2021; the contractor determined that the CFPB complied with the applicable requirements.

There have been several recent leadership changes at the Board. Lisa Cook, Philip Jefferson, and Michael Barr took office as members of the Board of Governors; the Board now has a full complement and is the most diverse it has been in its 108-year history. We have met with the new governors, and we look forward to continuing to work with leadership at the Board and the CFPB as we provide robust independent oversight to improve their programs and operations and to prevent and detect fraud, waste, and abuse.

It’s exciting to look to the future as workplaces evolve and we begin a new era of hybrid work, which aims to facilitate connection and collaboration while also providing staff with autonomy and flexibility. I want to recognize that we could not have reached this moment without the incredible commitment, determination, and resilience of the OIG staff. I cannot overstate my gratitude and admiration for how skillfully and gracefully they handled the many unforeseen challenges of recent years. I am profoundly thankful for every one of them.

Mark Bialek
Inspector General
October 31, 2022


We continued to promote the integrity, economy, efficiency, and effectiveness of the programs and operations of the Board of Governors of the Federal Reserve System and the Consumer Financial Protection Bureau. The following are highlights, in chronological order, of our work during this semiannual reporting period.

Board Trading Activity
Former Vice Chair Richard Clarida’s and Chair Jerome Powell’s trading activities did not violate the laws, rules, regulations, or policies as investigated by our office.

The Board’s Return-to-Office Plan
The Board implemented vaccination, building access, and other return-to-office (RTO) workplace safety measures in a manner consistent with the agency’s RTO plan.

The CFPB’s Reentry Plan
The CFPB implemented building access and other RTO workplace safety protocols at its headquarters building in a manner consistent with the agency’s reentry plan and applicable federal guidance.

The Board’s Information Security Program
The Board’s information security program continues to operate effectively at a level-4 (managed and measurable) maturity. The Board can strengthen its cybersecurity risk management processes.

The CFPB’s Information Security Program
The CFPB’s information security program continues to operate effectively at a level-4 (managed and measurable) maturity. The CFPB can strengthen policies, procedures, and processes in the areas of data loss prevention, software asset management, and continuity planning.

Many of our investigations during this semiannual reporting period concern fraud related to the Federal Reserve’s pandemic response efforts, including the Paycheck Protection Program Liquidity Facility, which extended credit to eligible financial institutions and took Paycheck Protection Program (PPP) loans guaranteed by the U.S. Small Business Administration (SBA) as collateral, and the Main Street Lending Program (MSLP), which supported lending to small and medium-sized for-profit and nonprofit organizations in sound financial condition before the COVID-19 pandemic. In addition, our office also conducted investigations in support of our membership on the Pandemic Response Accountability Committee (PRAC).

Missouri Business Owner Indicted for $27.1 Million Bank and PPP Fraud
Tod Ray Keilholz, of Missouri, was charged in a 52-count indictment for a $27.1 million bank fraud scheme that included over $12.4 million in PPP loans. The charges include multiple counts of bank fraud, making false statements to a financial institution, making false statements to the SBA, money laundering, and aggravated identity theft.

California Company Chief Executive Officer Pleaded Guilty to $21 Million Cryptocurrency Fraud
Michael Alan Stollery, of California, chief executive officer (CEO) of Titanium Blockchain Infrastructure Services Inc. (TBIS), pleaded guilty for his role in a cryptocurrency fraud scheme involving TBIS’s initial coin offering (ICO), which raised about $21 million from investors in the United States and overseas.

Owner of Massachusetts Tech Services Company Sentenced to Prison for $13 Million PPP Fraud
Elijah Majak Buoi, owner of information technology (IT) services company Sosuda Tech, was sentenced in connection with filing fraudulent PPP loan applications seeking more than $13 million. Buoi was sentenced to 39 months in prison and 3 years of supervised release, and he was ordered to pay restitution of $2 million and forfeiture of $2 million.

Former Executive Vice President Pleaded Guilty to Conspiracy to Defraud First NBC Bank in Louisiana
Robert B. Calloway pleaded guilty to conspiracy to defraud New Orleans–based First NBC Bank, where he worked as executive vice president. The bank, which failed in April 2017, was a subsidiary of First NBC Bank Holding Company. According to court documents, Calloway and other bank officers conspired to conceal the financial condition of a borrower from the bank’s board of directors, auditors, and examiners; falsely stated in loan documents that the borrower was able to pay his loans with cash generated by his businesses; and concealed the fact that they made loans to the borrower to keep him and his companies off month-end reports that went to the bank’s board, auditors, and examiners.