CREW sues SEC over destroyed documents

An SEC attorney, Darcy Flynn, came forward earlier this year and claimed that the SEC had destroyed more than 9,000 files from preliminary investigations under a policy that required their destruction if they did not lead to a full-blown examination.

The National Archives and Records Administration announced in August that the SEC did not have the authority to dispose of those documents, as that responsibility typically falls under its purview. It added that the SEC has halted the practice, but concerns remained that the SEC was slow in creating a replacement policy.

CREW also says Schapiro has failed to take steps to try and recover destroyed documents or follow up on any enforcement action stemming from the practice.

The treatment of SEC documents has also attracted attention on Capitol Hill. Sen. Chuck GrassleyCharles (Chuck) Ernest GrassleyOvernight Tech: Facebook faces crisis over Cambridge Analytica data | Lawmakers demand answers | What to watch for next | Day one of AT&T's merger trial | Self-driving Uber car kills pedestrian Overnight Cybersecurity: Trump-linked data firm Cambridge Analytica attracts scrutiny | House passes cyber response team bill | What to know about Russian cyberattacks on energy grid Overnight Finance: Congress races to finish .2T funding bill | What to look for in omnibus | AT&T merger trial kicks off | Stocks fall on tech troubles | Trump targets Venezuelan cryptocurrency | Record SEC whistleblower payout MORE (R-Iowa) sent a letter to the SEC in August demanding answers on its documentation protection procedures.

The SEC has struggled to shake criticism going back to the financial crisis, including its inability to sniff out Madoff while he was perpetrating his massive fraud. And the SEC has previously defended its practice, saying it keeps records of all its preliminary investigations, if not every document tied to it.