Congress Exempts SEC from Public Records Requests

The passage of the new Dodd-Frank Wall Street Reform and Consumer Protection Act has given the Securities and Exchange Commission (SEC) an expanded role in the regulation of the nation’s financial sector, with new powers and abilities that include overseeing the creation of 95 new rulemaking procedures, more than any other federal agency. This increase in responsibility, however, may have brought with it a contraction in public accountability due to a provision in the bill’s text.

Section 929I, Protecting Confidentiality of Materials Submitted to the Commission, states:

(1) IN GENERAL- Except as provided in subsection (f), the Commission shall not be compelled to disclose records or information obtained pursuant to section 17(b), or records or information based upon or derived from such records or information, if such records or information have been obtained by the Commission for use in furtherance of the purposes of this title, including surveillance, risk assessments, or other regulatory and oversight activities.

What this means is that the SEC may no longer be required to disclose public information that would ordinarily be accessed through a Freedom of Information Act (FOIA) action. The Fox Business Network recently got firsthand knowledge of this specific provision when the SEC cited the new law when refusing to divulge information to its reporters. The network’s attorney said that Fox is planning to challenge the SEC’s interpretation of this law in court.

This section is a relatively recent addition to the legislation ― it only appears in the version that was eventually signed into law and not in any other iteration.