In letters to the House Financial Services and Senate Banking committees on July 30, the SEC argued that regulated firms have refused to provide needed documentation to examiners over concerns that it would eventually be publicly disclosed.
The new law is "critical to our ability to develop a robust examination program that better protects investors," SEC Chairwoman Mary Shapiro wrote.
"This provision does not provide a "blanket" SEC exemption from FOIA and is not designed to protect the SEC as an agency from public oversight and accountability," she said.
Members of the Senate Judiciary Committee — Sens. Patrick Leahy
Patrick Joseph LeahyUniversity of Maryland to go online-only after Thanksgiving due to coronavirus surge Lobbying world Working together to effectively address patient identification during COVID-19 MORE (D-Vt.), John Cornyn
John CornynThe Hill's Morning Report - Too close to call Senate control in flux as counting goes forward in key states Chip Roy fends off challenge from Wendy Davis to win reelection in Texas MORE (R-Texas), Ted Kaufman (D-Del.), and Chuck Grassley
Charles (Chuck) Ernest GrassleyElection scrambles prospects for next COVID-19 relief bill Barrett confirmation stokes Democrats' fears over ObamaCare On The Money: Power players play chess match on COVID-19 aid | Pelosi bullish, Trump tempers optimism | Analysis: Nearly 1M have run out of jobless benefits MORE (R-Iowa) — introduced legislation and wrote a letter to Schapiro late last week saying they are concerned that "this provision could undermine the very important goal of bringing more transparency to Wall Street if improperly interpreted and implemented."
Several groups have called for a reexamination of the exemptions, including the Project on Government Oversight (POGO), which had a blog post Monday with the Issa letter.
"POGO and other good government groups are not convinced that the SEC needs any more authority to withhold information from the public," POGO said in the blog post. "We think that existing FOIA exemptions have stood the test of time in protecting against the release of sensitive or proprietary information. Furthermore, the SEC shouldn’t have to convince its regulated entities to cooperate, when it has the authority to issue subpoenas and impose penalties for non-compliance."
Other groups supporting the position include the American Library Association, the Government Accountability Project, OMB Watch, OpenTheGovernment.org and Public Citizen.
POGO wrote a letter Aug. 3 to Senate Banking Chairman Chris Dodd (D-Conn.) and House Financial Services Chairman Barney Frank (D-Mass.), stating that if the provision is "interpreted broadly, this provision has the potential to severely hinder the public's ability to access critical information related to the oversight activities of the Securities and Exchange Commission (SEC), thereby undermining the bill's overarching goals of more transparency and accountability."
Issa is asking Schapiro for a long list of documents he's expecting delivered by Aug. 19.
Those records include:
• All communications referring or relating to internal policies or guidance, effective between Jan. 1, 2005, and the present, governing the SEC’s treatment of FOIA requests.
• All records and communications referring or relating to Section 929I and every similar legislative proposal referred to in the SEC's July 30 letter.
• Documents that state the basis for the suggestion that FOIA’s examination exemption might cover some entities that the SEC regulates, but not others.
• Documents that describe every action taken by the SEC in response to a Sept. 25, 2009, Inspector General report.
• Documents that, in categorical terms, describe any information that was actually withheld from an SEC examiner under the circumstances described in the July 30 letter and was not covered by any FOIA exemption.
