POGO's Angela Canterbury “Cross Examines” in re: SEC's FOIA Exemptions

Saturday morning in America and life is good.

Yesterday, I gave major props to our great American Gary Aguirre for addressing critically important issues embedded in the recently enacted Financial Regulatory Reform package which allows further FOIA (Freedom of Information Act) exemptions by the SEC. (Aguirre wrote a fabulous dissertation in the September Wall Street Lawyer, which I embedded in my commentary.) I qualified yesterday's commentary, Great American Gary Aguirre “Cross Examines” in re: SEC's FOIA Exemptions, as perhaps the most important and enlightening ever put forth at Sense on Cents. I truly believe that. Gary Aguirre is a great American.

He has company.

Aguirre's dissertation drove a stake through the heart of the Wall Street-Washington incest that I believe lies at the core of our economic crisis. In an attempt to drive that stake even deeper, I am compelled to also highlight testimony provided by Angela Canterbury of the Project on Government Oversight (POGO) and delivered at Thursday's House Financial Services hearing.

Canterbury referenced Aguirre's piece extensively. We can all feel good about America while reviewing Testimony of POGO's Angela Canterbury Before the House Committee on Financial Services Regarding Legislative Proposals to Address Concerns Over the SEC's New Confidentiality Provisions. For those with an unbridled passion for truth, transparency, and integrity, you will want to take the time to fully read and review Canterbury's testimony. For those desirous of the Cliff-notes version, I am happy to provide a few highlights, including:

1. POGO has a keen interest in ensuring that the public has a way of holding our nation's financial regulatory agencies accountable for protecting the interests of taxpayers, investors, and consumers. The Freedom of Information Act (FOIA) is just such a tool, and is not only a cornerstone for open government but also a hallmark of our democracy. This is why we are deeply concerned about Section 929I of the Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act). This provision would provide the Securities and Exchange Commission (SEC, Commission, or agency) with an unnecessary and overly broad exemption to FOIA and a blanket authority to withhold public records.

2. The public-interest stakes in more—not less—transparency and accountability at the SEC cannot be overstated. American families continue to suffer from the financial crisis fueled in part by systemic regulatory failures. The SEC's particularly dramatic failure to fulfill its core mission of protecting investors is exemplified in the Madoff and Stanford cases.4 If allowed to stand, the 929I secrecy provision could significantly undermine this Committee's work and Congress' intent to provide greater transparency and accountability in the financial regulatory system when it passed the landmark Dodd-Frank Act.

3. Although the SEC claims that Section 929I is necessary to protect confidential information provided by its regulated entities,12 the FOX Business News case raises concerns that the agency could also use its blanket exemptions to cover up its own mistakes—including mistakes from past cases that are no longer open.

4. The SEC's inability to crack down on the Stanford and Madoff Ponzi schemes over years of leads and evidence exposed serious problems with the agency's operations, including mishandling whistleblower tips and failures to coordinate between different offices within the agency. If these shortcomings are kept hidden from the public, the media, and other outside stakeholders, the SEC will be shielded from external pressure to improve the agency's oversight of its regulated entities.

Is your adrenaline flowing after reading somebody with the character and integrity of Canterbury to stand and deliver for the American public? Mine is. I feel great about America knowing that there are individuals such as Gary Aguirre and Angela Canterbury willing to stand up and be counted in  the never ending pursuit for the truth. With this testimony, Canterbury joins Aguirre in the most elevated echelon of the Sense on Cents Hall of Fame!!

Larry Doyle

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I have no affiliation or business interest with any entity referenced in this commentary. As President of Greenwich Investment Management, an SEC regulated privately held registered investment adviser, I am merely a proponent of real transparency within our markets so that investor confidence and investor protection can be achieved.