Monday, August 02, 2010
Transparency is all well and good when it comes to Wall Street, but not the government agency charged with regulating it. As part of the financial reform bill approved by Congress, the Securities and Exchange Commission won’t have to turn over many documents requested by the public through the Freedom of Information Act (FOIA).
The little-noticed FOIA exemption was reported by Fox News, which has been battling the SEC in court to obtain records pertaining to the investigations of Ponzi schemes by Bernie Madoff and R. Allen Stanford. SEC lawyers insist they don’t have to release any documents sought by Fox News because of the passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act.
Some legal experts say Section 929I of the act could be interpreted to mean that the SEC can set its own rules about how to respond to Freedom of Information requests and that, potentially, the majority of SEC records could be exempt from public disclosure. The wording of the section says that the SEC should not be compelled to disclose records or information obtained “for use in furtherance of the purposes of this title, including surveillance, risk assessments, or other regulatory and oversight activities.”
Representative Darrell Issa (R-California), the ranking member of the House Committee on Oversight and Government Reform, plans to introduce legislation to repeal Section 929I.
However, two other provisions have been identified that, in the interest of helping corporations shield information from the public, allow the SEC to ignore certain court subpoenas and FOIA requests.
-Noel Brinkerhoff
SEC Says New Financial Regulation Law Exempts It from Public Disclosure (by Dunstan Prial, Fox Business)
Did Congress Just Exempt the SEC from FOIA? (by Michael Smallberg, Project on Government Oversight)
Does FinReg Contain Anti-Transparency Measures? (by Daniel Schuman, Sunlight Foundation)
Comments