SEC blasted for disclosure deficiencies

The Securities and Exchange Commssion’s problems handling requests under the Freedom of Information Act make its compliance with the federal public access law the weakest among all federal agencies, a report released Friday by the agency’s inspector general has found.

A separate audit found the SEC must tighten management of its contracting and procurement operations to fix significant deficiencies.

The review of the SEC’s handling of the FOIA law, aimed at promoting openness and transparency in government, also said the agency’s chief FOIA officer held the position temporarily and didn’t have sufficient legal authority.

“There are inadequate or incorrect procedures for determining whether potentially responsive documents exist and how exemptions (from disclosure) … are applied,” says the report commissioned by the office of Inspector General David Kotz.

As a result, a presumption in favor of withholding, rather than disclosing, information has been created — contrary to the FOIA law, the report says.

The SEC’s rate of compliance with FOIA rules was “significantly lower” than those of all other federal agencies, the report said.

In addition, it said, few staff working on FOIA requests at the agency have written policies and procedures for processing them, thereby increasing the risk of errors that could result in information being disclosed when it should be withheld or vice versa.

The report recommends that SEC Chairman Mary Schapiro name a qualified person as the new chief FOIA officer, with sufficient authority to carry out the responsibilities effectively. Schapiro’s office should communicate “on an ongoing basis to (SEC) employees and the public the importance” of the FOIA law to the agency’s mission, it says.

Kayla Gillan, Schapiro’s deputy chief of staff, said in a letter to Kotz: “We are committed to the principle of openness in government that is embodied by the Freedom of Information Act and intend to take any necessary steps to re-emphasize the importance of FOIA throughout the agency.”

In contracting and purchasing operations, the audit found that the agency’s Office of Administrative Services and Office of Acquisitions don’t maintain accurate records and data, and have reported inaccurate data to the Federal Procurement Data System. Activities and training of personnel in the SEC regional offices isn’t adequately monitored, it said.

The audit report recommended the agency develop standard procedures to track them, as well as a periodic internal review process to ensure that the standards are followed. It said the administrative services and acquisitions offices “have proactively taken steps and developed plans to address” some of the deficiencies.

Sharon Sheehan, associate director for administrative services, told Kotz in a letter that her office concurs with the recommendations and “has begun taking appropriate steps” to address them.

Related Topics: Securities and Exchange Commission